Reference no: EM132558178

An examination of the ledger of XYZ Corporation revealed the following balances on January 1, 2014.

Ordinary Share Capital, 30,000 shares authorized at par value of P100,

25,000 shares issued of which, 1,000 shares

are in the Treasury.... ......................................................P1,500,000

Ordinary Share Premium............................................................ 500,000

Appropriation reserve for Treasury shares.................................... 80,000

Retained Earnings.................................................................... 750,000

Treasury shares at cost, 1,000 shares.......................................... 80,000

The following transactions occurred during the year:

Jan. 5 Subscribed 5,000 ordinary shares for 110.00 per share, with 40% down payment.

Jan. 10 Declared 25% stock dividends on the shares outstanding to stockholders on record as of Mar 10. The dividends will be distributed on Mar. 15, the fair market value on date was 115.

Mar. 15 Sold 1,000 treasury shares at 85.00 per share and reduce the treasury appropriation. Paid also the dividends declared

Mar. 31 Declared a 25 dividends per share was declared to stockholders on record as of March 30, dividends is to distributed on April 30.

Apr. 30 Payment of dividends.

Apr. 20 Acquired 1,500 shares from stockholders at 80 per share.

May 1 Declared a 10% scrip dividend to stockholders on records as of May 16, dividends to be distributed on August 31 plus 20% interest.

Aug. 31. Paid the scrip dividends

Required:

Question 1. Journal entry using memo method.

Question 2. Compute the total number of shares entitled to dividends