CERCADO, GERAN KEARN L.

ACC 221 2:15 – 4:15PM

BSA-2
P.T – 3.3
Shareholder’s Equity

Red Heart Corporation

Required:
a. 2016
June 15 Cash 6,000,000
Ordinary Share Capital 5,000,000
Share Premium – Ordinary 1,000,000

Sept. 30 Retained Earnings (80,000 x 5% x 110) 440,000

Share dividends distributable (4,000 x 100) 400,000
Share Premium – Ordinary 40,000

Nov. 10 Share dividends distributable 400,000

Ordinary share capital 400,000

Dec. 31 Income Summary 1,175,000

Retained Earnings 1,175,000

2017
Mar. 1 Treasury Share (3,000 x 95) 285,000
Cash 285,000
May 1 Cash (1,500 x 120) 180,000
Treasury Shares (1,500 x 95) 142,500
Paid in capital from treasury shares 37,500

Aug. 10 Issued 82,500 rights to shareholders entitling holders to purchase

2 additional shares for P125 per share.

Sept. 15 Cash (15,000 x 2 x 125) 3,750,000

Ordinary share capital (30,000 x 100) 3,000,000
Share Premium – Ordinary 750,000

Oct. 31 Cash (40,000 x 2 x 125) 10,000,000

Ordinary share capital (80,000 x 100) 8,000,000
Share Premium – Ordinary 2,000,000

Dec. 10 Retained Earnings 962,500

Dividends Payable (192,500 x 5) 962,500

Dec. 20 Ordinary Share Capital (1,000 x 100) 100,000

Share Premium – Ordinary (1,000 x 10) 10,000
Paid in capital from treasury shares 15,000
Treasury Share 95,000

Dec. 31 Income Summary 1,200,000

Retained Earnings 1,200,000
b. Shareholder’s Equity
Ordinary share capital, P100 par, 193,000 shares P 19,300,000
issued; 500 shares in the treasury
Share Premium – Ordinary 4,080,000
Paid in capital from treasury shares 52,500
Retained Earnings 1,422,500
Treasury shares (47,500)
Total Shareholder’s Equity, Dec. 31, 2017 P 24,807,500