Reference no: EM132946388

Questions -

Q1. Data from the statement of financial position of Alpha Builders Corp. shows

Authorized share capital P100,000; Share premium, P4,000; Subscriptions Receivable P16,000; and Unissued share capital of P40,000; Subscribed share capital P30,000.

How much total cash was collected from the sale and subscription of shares?

a, P104,000

b. Some other answer

c. P88,000

d. P78,000

Q2. The Rexidel Corporation on November 1 had its Articles of Incorporation approved by the Philippine SEC. It authorized the company to issue 750,000 ordinary shares with P50 par value. On that date, five incorporators subscribed to 262,500 shares at par as follows:

Incorporators Name No. of Shares Subscribed Down payment

Oliver 45,000 P600,000

Marvin 60,000 750,000

Jay-ar 45,000 525,000

Raymond 75,000 900,000

Ramir 37,500 450,000

Based on the above information, which of the following is incorrect?

a. The company is compliant with SEC's requirements because the amount that should be paid by incorporators above is P2,343,750.

b. The total amount of paid-in capital should be at least P3,281,250.

c. The company violates the minimum pre-incorporation subscription requirement.

d. The incorporators total subscription amounted to P13,125,000 which is more than 25% of the total amount of share capital.

Q3. Forevermore Company uses journal entry method in recording share capital transaction. On January 1, 2020, the company authorized to issue 150,000 shares with a par value of P10. What would be the correct entry for this transaction?

a. DR Cash 1,500,000 CR Share Capital 1,500,000

b. DR Unissued Share Capital 1,500,000 CR Authorized Share Capital 1,500,000

c. DR Authorized Share capital 1,500,000 CR Unissued Share Capital 1,500,000