PROBLEM NO.

1
The following transactions appear on the “Trading Securities” account of
CHICKER Corporation:
Date Particulars Debit
Credit
03/1/05 Purchased 40,000 shares of PLDT at
P30.75/share and 20,000 shares of Benpres at P1,690,000
P23/share
07/3/05 Purchased PAG-IBIG 15% bonds, face value
P4,000,000. Interest dates July 1 and Jan 1.
Maturity date July 1, 2009 4,000,000
11/5/05 Sold 14,400 shares of PLDT at P30/share and
4,000 shares of Benpres at P25/share P532,000
12/31/05 Sold PAG-IBIG bonds at 98 plus accrued interest 4,220,000
Your audit revealed the following additional
information:
1. CHICKER received on Oct. 1, 2005, 8,000 shares of PLDT as stock
dividend.
2. Benpres declared a 15% stock dividend to all stockholders of record as of
November
15, 2005 payable December 1, 2005.
Note: Disregard broker’s commission and stock transfer tax in your
solution.
QUESTI
ONS:
Based on the above and the result of your audit, answer the
following:
1. How much is the adjusted balance of CHICKER’s “trading securities” as of
December
31, 2005?
a. P935,200 b. P1,155,200 c. P1,158,000 d. P1,229,000
2. How much is the average cost per share of PLDT’s stocks as of December 31,
2005?
a. P23.43 b. P25.63 c. P29.50 d. P30.75
3. How much is the average cost per share of Benpres stocks as of December
31,
2005?
a. P20.00 b. P22.50 c. P23.00 d. P25.00
4. How much is the total gain (loss) on sale of trading securities for the year
2005?
 a. P291,000 b. P3,000 c. (P82,800) d. (P9,000)
SUGGESTED ANSWERS: D, B,
A, D