Reference no: EM133103833

Question - On January 1, 2018, Baroa Company is authorized to issue 100,000 P100 par value ordinary shares. The following transactions occurred during 2018:

January 1 Issued 40,000 ordinary shares at P130 per share. February 1 Issued 30,000 ordinary shares for the following assets:

Machine 500,000 fair value Land None

Building 1,100,000 fair value

The ordinary shares are selling at P120 on this date.

July 1 Purchased 10,000 ordinary shares at P150 per share to be held as treasury.

August 1 Declared a 2 for 1 split.

September 15 Reissued 5,000 treasury shares at P100 per share.

December 31 Declared a P10 per share cash dividend on the ordinary shares

December 31 Net income for the year is P3,000,000.

Required -

1. What is the share capital at year-end?

a. 7,000,000 b. 6,000,000

c. 6,250,000 d. 5,000,000

2. What is the share premium at year-end?

a. 1,800,000 b. 1,925,000

c. 1,200,000 d. 1,325,000

3. What is the balance of retained earnings at year-end?

a. 3,000,000 b. 1,600,000

c. 1,750,000 d. 1,800,000

4. What is the total shareholder's equity at December 31, 2018?

a. 9,425,000 b. 8,950,000

c. 9,550,000 d. 8,925,000