Name: Course & Yr: Schedule: Score: _____

I – Journalizing.

A.Khyle Lorenz Incorporated was authorized by its charter to issue 1,000 shares of ordinary share at P200 par value per
share. To comply with SEC requirements the following shares were subscribed and 25% of which are paid up on
December 1, 2012.
Subscribed and
Paid-up Shares Amou
nt
AdelaidoDalocanog 50 shares x P200 P10,0
00
SerafinMascarinas 40 shares x 200 8,0
00
Norberto Bersal 60 shares x 200 12,0
00
Jose Elises 80 shares x 200 16,0
00
Ian Basarte 20 shares x 200 4,0
00
Total 250 shares P50,0
00

Dec. 1 – Paid incorporation fee, attorney’s fee and promotion expenses, P14,000.
3 – Received subscription of 30 ordinary shares at P220 per share from Severo Santos with 50% down payment.
5 – Issued 50 ordinary shares for cash at P210 per share to Leonora Caminade.
8 – Collected in full the subscription balance of Severo Santos.
14 – Received subscription of 60 ordinary shares at P204 per shares from Florencio Ibanez, Jr.
19 – Received additional subscription from Norberto Bersal for 40 ordinary shares at par value after
paying his original subscription balance.
21 – Received additional subscription from AdelaidoDalocanog for 60 ordinary shares at par value.
25 – Received subscription of 100 ordinary shares from Jocelyn Te at par value.
28 – Issued 100 ordinary shares for cash to Richard Baligala at P202 per share.
30 – Received subscription of 40 ordinary shares from Jocelyn Joson at par value with 30% down payment.

Required: Record the above transactions including authorization and 25% compliance of corporate requirements under
Memorandum Entry Method.

Answer:

B. On March 2, 2013, Khalyl Dionne Marketing Corporation was authorized to issue 2,000 ordinary shares with a par value
of P2,000 per share.

2013 March

3 – Received subscriptions from the following incorporators as well as the 25% paid-up requirement:

CypresMerceditoBoquecosa - 100 shares

Jose Recon Tano - 200 shares
Everon Joseph Santos - 100 shares
Duke Anthony Abella - 50 shares
Perpetua Peras - 50 shares

5 – Tano and Santos paid their subscriptions balances in full and share certificates were issued to them.
6 – Received subscription of 30 shares from Alfredo Yao at par value and collected 20% of his subscription.
15 – After all lawful calls and notice, Alfredo Yao defaulted and all his subscribed shares were declared delinquent and
were advertised for public auction.
16 – Advertising expense paid by the corporation amounted to P10,000.
20 – At the public auction, ConradoBaugbog was the highest bidder for 25 ordinary shares, he pays the balance of the
subscription plus advertising cost.
21 – The share certificates were issued.

Required: Entries in the book of the corporation from the authorization up to the defaulting subscriber using
Memorandum Entry Method.
ANSWERS:

A.

Dec. 1 Authorized to issue 1,000 shares of ordinary shares at P200 par value per share.

Cash 12,500
Subscription Receivable 37,500
Subscribed Share Capital – Ordinary 50,000
To record the 25% of the authorized shares subscribed.

Organization Expense 14,000

Cash 14,000
To record organization expenses.

Dec. 3 Cash 3,300

Subscription Receivable – Ordinary 3,300
Subscribed Share Capital – Ordinary 6,000
Share Premium – Ordinary 600
To record subscription of 30 ordinary shares at P220 par value.

Dec. 5 Cash 10,500

Subscribed Share Capital – Ordinary 10,000
Share Premium – Ordinary 500
To record issuance of 50 ordinary shares at P210 par value per share.

Subscribed Share Capital – Ordinary 10,000

Share Capital – Ordinary 10,000
To record authorization of 50 ordinary shares.

Dec. 8 Cash 3,300

Subscription Receivable – Ordinary 3,300
To record collection of subscription balance of Severo Santos.

Subscribed Share Capital – Ordinary 6,000

Share Capital – Ordinary 6,000
To record issuance of Stock Certificate.

Dec. 14 Subscription Receivable – Ordinary 12,240

Subscribed Share Capital – Ordinary 12,000
Share Premium – Ordinary 240
To record subscription of 60 ordinary shares at P204 par value per share.

Dec. 19 Subscription Receivable – Ordinary 8,000

Subscribed Share Capital – Ordinary 8,000
To record subscription of Norberto Bersal of 40 ordinary shares at P200 par value.

Cash 9,000
Subscription Receivable-Ordinary 9,000
To record payment of original subscription balance by Norberto Bersal.

Dec. 21 Subscription Receivable – Ordinary 12,000

Subscribed Share Capital – Ordinary 12,000
To record subscription of Adelaido Dalocanog of 60 ordinary shares at P200 par value.

Dec. 25 Subscription Receivable – Ordinary 20,000

Subscribed Share Capital – Ordinary 20,000
To record subscription of Jocelyn Te of 100 ordinary shares at P200 par value.

Dec. 28 Cash 20,200

Subscribed Share Capital – Ordinary 20,000
Share Premium – Ordinary 200
To record subscription of Richard Baligala of 100 ordinary shares at P202 par value.
 Dec. 30 Cash 2,400
Subscription Receivable 5,600
Subscribed Share Capital 8,000
To record subscription of 40 ordinary shares from Jocelyn Joson at par value with 30%
down payment

B.

March 2 Authorized to issue 2,000 ordinary shares with a par value of P2,000 per share.

March 3 Cash 250,000

Subscription Receivable – Ordinary 750,000
Subscribed Share – Ordinary 1,000,000
To record subscriptions of 500 ordinary shares at P2,000 par value per share.

March 5 Cash 300,000

Subscription Receivable- Ordinary 300,000
To record payment of balance Jose Recon Tano for 200 ordinary shares.

Subscribed Share Capital – Ordinary 400,000

Share Capital – Ordinary 400,000
To record issuance of Stock Certificate to Jose Recon Tano.

Cash 1500,000
Subscription Receivable- Ordinary 150,000
To record payment of balance Everon Joseph Santos for 100 ordinary shares.

Subscribed Share Capital – Ordinary 200,000

Share Capital – Ordinary 200,000
To record issuance of Stock Certificate to Everon Joseph Santo.

March 6 Cash 12,000

Subscription Receivable- Ordinary 48,000
Subscribed Share Capital – Ordinary 60,000
To record subscription of Alfredo Yao and 20% down payment.

March 15 Receivable from the Highest Bidder 48,000

Subscription Receivable- Ordinary 48,000
To record amount receivable from the highest bidder.

March16 Receivable from the Highest Bidder 10,000

Cash 10,000
To record payment of the expense.

March 20 Cash 58,000

Receivable from the Highest Bidder 58,000
To record payment of the highest bidder, Conrado Baugbog.

March 21 Subscribed Share Capital- Ordinary 60,000

Share Capital 60,000
To record issuance of share certificate.