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What is the new book value per share

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Reference no: EM132852593

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Q1. As of December 15, 2020, ABC Corporation reported Ordinary Shares, 100,000 shares issued and outstanding, P15,000,000; Share Premium, P2,000,000; Retained Earnings, P9,150,000. The next day, the entity received donation P1,000,000 cash and 4,000 of its own shares from a shareholder when the market price is P261.50 per share. What is the new book value per share?

a. P282.81

b. P271.50

c. P293.71

d. P281.96

Q2. On October 1, 2019, ABC Corporation shareholders' equity showed: Ordinary Shares, no-par value, 50,000 shares authorized; 30,000 shares issued and outstanding, P1,290,000;; and Retained Earnings P1,200,000. When the board of directors changes the no-par value ordinary shares to P40-par value, how will this affect the book value per share?

a. Decrease the book value per share.

b. Increase the book value per share.

c. Book value per share will remain the same.

d. The book value per share cannot be determined due to limited information.

Q3. On October 1, 2019, ABC Corporation shareholders' equity showed: Ordinary Shares, P100 par value, 50,000 shares authorized; P3,000,000; Share Premium, P120,000; and Retained Earnings P1,200,000 Which of the following IS TRUE when the entity declares 10% share dividend when the market price is P145 per share?

a. Retained earnings will decrease by P300,000 only.

b. Share Premium account will remain at P120,000.

c. Ordinary share account increase by P300,000.

d. The book value per share will increase.

Q4. On October 1, 2019, ABC Corporation shareholders' equity showed: Ordinary Shares, P100 par value, 50,000 shares authorized; P3,000,000; Share Premium, P120,000; and Retained Earnings P1,200,000 Which of the following has least decrease effect on the retained earnings?

a. A 2-for-1 share split, 20% share dividend, P1 cash dividend per share.

b. 20% share dividend, a 2-for-1 share split, P1 cash dividend per share.

c. P1 cash dividend per share, 20% share dividend, a 2-for-1 share split.

d. 20% share dividend, P1 cash dividend per share, a 2-for-1 share split.

Reference no: EM132852593

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