Reference no: EM133010406

Question - Kingdom Company began operations on January 1, 2016, by issuing at P15 per share one-half of the P 1 par value ordinary shares authorized of 475,000 shares. In addition, Kingdom has 250,000, 6% preferred shares with P 5 par value authorized. During 2016, Kingdom reported net income of P 512,500 and declared dividends of P 118,750. During 2017, the following transactions took place:

Jan. 10 Issued additional 50,000 ordinary shares for P 17 per share.

Apr. 2 Issued 75,000 preference shares for P 8 per share

Jul. 21 Authorized the acquisition of a custom made machine to be delivered in January 2018, Kingdom appropriated P 147,500 of retained earnings for the purchase.

Oct. 25 Issued an additional 25,000 preference shares for P 9 per share

Dec. 31 Reported 607,500 of net income and declared a dividend of P 317,500 to shareholders of record on January 31, 2018, to be paid on February 4, 2018.

Required - What the total shareholders' equity on December 31, 2017?

a. P3,956,250

b. P5,773,750

c. P5,921,250

d. P6,238,750