Reference no: EM132783381
The Shareholders' Equity of ADAM CO. on January 1, 2020 appears as follows:
12% Preference Share, P200 par, 20,000 shares authorized, 7,000 shares issued and outstanding 1,400,000
Share Premium - Preference 175,000
Ordinary Shares, P100 par, 180,000 shares authorized, 35,000 shares issued and outstanding 3,500,000
Share Premium - Ordinary 1,750,000
Retained Earnings 4,500,000
During 2020, the following transactions occurred:
Jan. 2: Issued 20,000 ordinary shares for P180 per share
Feb. 7: Purchase 6,000 ordinary shares for the treasury at P200 per share
Feb. 15: Shareholders donated 5,000 entity's own ordinary shares to the corporation
May 14: Sold half of the treasury shares acquired last February 7 for P220 per share.
June 27: Sold the donated shares at P220 per share
Aug. 28: Issued 4,000 preference shares to acquire special equipment with a fair value of P1,440,000
Sept. 24: Received Subscription to 18,000 ordinary shares at P250 per share
Sept. 25: Received Cash Payment for each subscriber for 40% of the ordinary share subscription price
Nov. 24: Received full payment of the 10,000 shares on Sept. 24 and 25
Dec. 31: Close Net income of P1,000,000 from the income summary account to retained earnings.
Problem 1: How much is the total share premium on December 31, 2020?