Reference no: EM132867358

Question - The following transactions relate to the shareholders' equity of Telecom Corporation for 2021, its initial year of operations and existence:

a. On January 7, the articles of incorporation were filed with the Securities and Exchange Commission (SEC). The SEC authorized the issuance of 10,000 shares of P50 par value preference share capital and 200,000 shares of P10 par ordinary share capital

b. On January 28, forty thousand ordinary shares were issued at P15 per share.

c. On February 14, one hundred twenty thousand ordinary shares were issued in exchange for land and building that have an appraised value of P700,000 and P1,100,000, respectively. On this date, the shares trade at P15 per share on the over the counter market.

d. On February 24, the company issued to the lawyers 2,000 ordinary shares for legal services in connection with the incorporation. The fair value of the shares on this date is P16.

e. On September 12, the company received subscriptions for 10,000 preference shares at P53 per share. A 40% down payment accompanied the subscriptions. The balance is due on October 1.

f. October 1, the final payment on 10,000 shares subscribed in (e) was received.

Required - Using the journal entry method, record the foregoing transactions

Assume that there were no other share capital transactions until December 31. Determine the following as of December 31:

(1) Total legal capital

(2) Total share premium

(3) Total contributed capital