Reference no: EM132918958

Question - On January 1, 2021, ABC Corporation was authorized to issue 2 classes of stocks: 50,000 preference shares with par value of P 50 and 100,000 ordinary shares with par value of P 20. On January 8, 2021, ABC received subscriptions of 20,000 ordinary shares for P 25 per share. 30% from the subscription price were received at subscription date and the balance payable within 60 days. At call date, the balance was not paid and the shares were declared delinquent. A total of P 20,000 was paid for advertising of original unissued shares and delinquent shares and half of the total costs relates to the delinquent shares. At the public auction, ABC Corporation received bids from Gavin -11,000 shares , Cookie- 8,000 shares and Bella- 10,000. The amount from highest bidder was collected and share certificates were accordingly issued.

Required - How many shares will the original subscriber and highest bidder receive?

A. Original subscriber - 12,000 ; highest bidder- 8,000

B. Original subscriber - 9,000 ; highest bidder- 11,000

C. Original subscriber - 20,000 ; highest bidder- 0

D. Original subscriber - 10,000 ; highest bidder- 10,000