APC_ch10sol.2014

CHAPTER 10 Share Capital Transactions Subsequent to Original Issuance E 10-1 1.a Ordinary Share Capital (2,000 sh x P50) Ordinary Share Premium (2,000 sh x P20) Paid-In Capital r!m "etirement ! OSC Cash (2,000 sh x P45)

$

2.

100,000 40,000 50,000 #0,000

Ordinary Share Capital Ordinary Share Premium Paid-In Capital r!m "etirement ! OSC Cash (2,000 sh x P%0)

100,000 40,000 20,000 120,000

200, 200,00 000 0 & 2,00 2,000 0 ' 1#, 1#,00 000 0 sha share ress iss issue ued d and and !uts !utsta tand ndin in 

E 10 -2 1. *reasury Shares (5,000 sh x P20) Ca Cash

100,000 100,000

"etained +arnins "etained +arnins ppr!priated !r *reasury Shares

100,000

Cash (,500 sh x P5) *reasury Shares (,500 x P20) Paid-In Capital r!m Sale ! *reasury Shares

122,500

100,000

0,000 52,500

"etained +arnins ppr!priated !r *reasury Shares "etained +arnins

0,000 0,000

SHAREHO!ERS" E#$IT%

2. C!ntri$uted Capital/ Ordinary Share Capital, P25 par, 100,000 shares issued, #,50 ,500 sh shares res !u !utstandin, 1, 1,500 sh shares in in th the tr treasury Ordinary Share Premium Paid-in Capital r!m Sale ! *reasury Shares "etained +arnins/ "etained +arnins ppr!priated !r *reasury Shares nappr!priated "etained +arnins *!tal C!ntri$uted Capital and "etained +arnins ess *reasury Shares, at !st - 1,500 shares *!tal Shareh!lders3 +uity

P2,50 ,500,000 1,000,000 52,500 P 0,000 1,40,000

P,552,500

1,500,000 P5,052,500 0,000 P5,022,500

+ 10- 1. lternatie 1 a. "eei "eeied ed 5,00 5,000 0 !rdin !rdinary ary shares shares as d!na d!nati! ti!n n r!m r!m a ma6!r ma6!r sha shareh reh!ld !lder er $.

Cash 7!nated Capital 5,000 shares x P50

250,000 250,000

APC – Chapter 10 (2014 edition)

page 2

lternatie 2 a. *reasury Shares 7!nated Capital

200,000

$.

250,000

200,000

Cash *reasury Shares PIC r!m Sale ! *reasury Shares (!r 7!nated Capital)

2. Issued Outstandin

ater the d!nati!n 150,000 shs 145,000 shs

+ 10-4 1.a Preerene Share Capital (,000 sh x P50) Preerene Share Premium (,000 sh x P25) PIC r!m C!nersi!n ! PSC int! OSC Ordinary Share Capital (,000 sh x 4 x P10) $



2.a $ 



ater the sale ! the d!n shs 150,000shs 150,000shs

150,000 5,000 105,000 120,000

Preerene Share Capital (,000 sh x P50) Preerene Share Premium "etained +arnins Ordinary Share Capital (,000 sh x 10 x P10)

150,000 5,000 5,000

Preerene Share Capital (,000 sh x P50) Preerene Share Premium "etained +arnins Ordinary Share Capital (,000 sh x  x P10)

150,000 5,000 15,000

Issued and !utstandin PS 4,000 PS 4,000 PS 4,000

00,000

240,000

OS 112,000 OS 10,000 OS 124,000

E 10-& 1.a Ordinary Share Capital, P20 par Ordinary Share Capital, P4 par

$

200,000 50,000

1,000,000 1,000,000

Ordinary Share Capital, P20 par Ordinary Share Capital, P0 par

1,000,000

Ordinary Share Capital, P20 par Ordinary Share Premium Ordinary Share Capital, P15 par (50,000 sh x P15) Paid-In Capital r!m "eduti!n in Par 8alue ! OSC

1,000,000 200,000

'OTE(

1,000,000

50,000 450,000

)** in e+change ,or one orinar. share /ith a par alue o, P20 instea o, P2&


page 3

d

Ordinary Share Capital, P20 par 1,000,000 Ordinary Share Premium 200,000 Ordinary Share Capital, P20 stated alue 1,000,000 PIC r!m +xhane ! Par !r 9!-Par Share Capital 200,000 'OTE( )**one ne/ orinar. share /ith a state alue o, P20 in e+change ,or one orinar. share /ith a par alue o, P20

2. a $

20,000 x 5 ' 100,000 shares 20,000:4 ' 5,000 shares

. 20,000 shares d. 20,000 shares

+ 10-% 1.a *reasury Shares (5,000 shares x P10) Cash

50,000 50,000

"etained +arnins "etained +arnins ppr!priated !r *reasury Shares

50,000

Cash (4,000 x P12) PIC r!m Sale ! *reasury Shares *reasury Shares (4,000 x P10)

4,000

"etained +arnins ppr!priated !r treasury Shares "etained +arnins

40,000

,000 40,000

Cash (1,000x P) PIC r!m Sale ! *reasury Shares *reasury Shares (1,000 x P10)

2.

10,000

Preerene Share Capital (1,000x P100) Preerene Share Premium PIC r!m C!nersi!n ! PSC int! OSC Ordinary Share Capital (1,000 x 10 x P5) Issued and Outstandin

PS #,000 shs

40,000 ,000 ,000

"etained +arnins ppr!priated !r *reasury Shares "etained +arnins $.

50,000

10,000 10,000 100,000 20,000 0,000 50,000

OS 510,000 shs

P 10 -1 1.a PSC Su$sripti!n "eeia$le (10,000 sh x P125) OSC Su$sripti!n "eeia$le (20,000 sh x P%0) PSC Su$sri$ed (10,000 sh x P100) OSC Su$sri$ed (20,000 sh x P50) Preerene Share Premium Ordinary Share Premium

1,250,000 1,200,000 1,000,000 1,000,000 250,000 200,000


$.

.

d.

e.

Cash PSC Su$sripti!n "eeia$le (P1,250,000 x 50;) OSC Su$sripti!n "eeia$le (1,200,000 x 50;)

1,225,000

Cash PSC Su$sripti!n "eeia$le OSC Su$sripti!n "eeia$le

1,225,000

PSC Su$sri$ed OSC Su$sri$ed Preerene Share Capital Ordinary Share Capital

1,000,000 1,000,000

00,000 5,000

Cash (1,500 sh x P%5) *reasury Shares (1,500 sh x P50) PIC r!m Sale ! *reasury Shares

Cash (2,000 x P5%) 7!nated Capital

<.

1,000,000 1,000,000

Preerene Share Capital (,000 sh x P100) Preerene Share Premium (,000 x P25) Ordinary Share Capital (,000 sh x P50) PIC r!m C!nersi!n ! PSC int! OSC

.

6.

%25,000 %00,000

125,000

"eeied 2,000 !rdinary shares as d!nati!n r!m a ma6!r shareh!lder

i.

%25,000 %00,000

*reasury Shares - Ordinary Share Capital (2,500 sh x P50) Cash

.

h.

page 4

Cash (1,000 sh x P%0) *reasury Shares (1,000 sh x P50) PIC r!m Sale ! *reasury Shares

125,000

150,000 225,000 #,500 5,000 22,500

112,000 112,000 %0,000 50,000 10,000

Ordinary Share Capital, P50 par (2,000 x P50) Ordinary Share Premium Ordinary Share Capital, P0 stated alue (2,000 sh x P0) PIC r!m +xhane ! Par !r 9!-Par Shares

1,150,000 200,000

In!me Summary "etained +arnins

1,500,000

"etained +arnins 7iidends Paya$le PS ' ,000 sh x P100 x 10; ' P0,000 CS ' 2,000 sh x P1 ' 2,000

%#0,000 %%0,000

1,500,000 #,000 #,000


2* SHAREHO!ERS" E#$IT% C!ntri$uted Capital/ Share Capital/ 10; Preerene Share Capital, P100 par, 20,000 shares auth!ri=ed, ,000 shares issued and !utstandin Ordinary Share Capital, P0 stated alue, 50,000 shares auth!ri=ed, 2,000 shares issued and !utstandin dditi!nal Paid-in Capital/ Preerene share Premium Paid-in Capital r!m +xhane ! Par !r 9!-Par Shares Paid-in Capital r!m Sale ! *reasury Shares Paid-in Capital r!m C!nersi!n ! PSC int! OSC 7!nated Capital *!tal C!ntri$uted Capital "etained +arnins *!tal Shareh!lders3 +uity P 10-2 "euirement 1 a. *reasury Shares & Ordinary SC (5,000 sh x P1%) Cash

"etained +arnins "etained +arnins ppr!priated !r *reasury Shares $.

.

d.

e.

. .

Preerene Share Capital (10,000 sh x P100) Preerene Share Premium (10,000 sh x P5) PIC r!m C!nersi!n ! PSC int! OSC Ordinary Share Capital (10,000 x 4 x P20) !unts Paya$le Ordinary Share Capital (500 sh x P20) Ordinary Share Premium "etained +arnins 7iidends Paya$le PSC' 40,000 x P100 ' P4,000,000 x 5; ' P200,000 OSC ' (150,000 > 40,000 > 500 & 5,000) x P2 'P1,000

page 5

P00,000 %#0,000 P15,000 %%0,000 2,500 225,000 112,000

0,000 0,000 0,000 1,000,000 50,000 250,000 00,000 12,500 10,000 2,500 51,000 51,000

50,000

"etained +arnins ppr!priated !r treasury Shares "etained +arnins

2,000

In!me Summary "etained +arnins

1,204,500 P2,5#4,500 1,40,000 P4,001,500

0,000

and *reasury Shares (2,000 sh x P1%) PIC r!m Sale ! *reasury Shares

Ordinary Share Capital, P20 par(150,000 > 40,000 > 500) x P20 Ordinary Share Capital, P10 par

P1,#0,000

2,000 1,000 2,000 ,10,000 ,10,000 200,000 200,000


page 6

SHAREHO!ERS" E#$IT% 2. C!ntri$uted Capital/ Share Capital/ 5; Preerene Share Capital, P100 par, 40,000 shares issued and !utstandin Ordinary Share Capital, P10 par, 1,000 shares issued, ,000 shares !utstandin, ,000 shares in treasury dditi!nal Paid-in Capital/ Preerene Share Premium Ordinary Share Premium Paid-in Capital r!m Sale ! *reasury Shares Paid-in Capital r!m C!nersi!n ! PSC int! OSC *!tal C!ntri$uted Capital "etained +arnins/ "etained +arnins ppr!priated !r treasury Shares nappr!priated "etained +arnins *!tal C!ntri$uted Capital and "etained +arnins ess *reasury Shares at C!st (,000 shares) *!tal Shareh!lders3 +uity

P4,000,000 ,10,000 P 200,000 52,500 1,000 250,000

P 4,000 1,01,000

P ,10,000

1,220,500 P #,00,500

1,12#,000 P10,15#,500 4,000 P10,111,500

P 10   SHAREHO!ERS" EQUITY

C!ntri$uted Capital/ Share Capital/ 10; Preerene Share Capital, P50 par, 115,000 shares issued and !utstandin P 5,50,000 Ordinary Share Capital, P5 par, 2,050,000 shares issued, inludin 5,000 shares in the treasury 10,250,000 dditi!nal paid-in apital/ Preerene Share Premium P 1,150,000 Ordinary Share Premium 5,5,000 Paid-in Capital r!m Sale ! *reasury Shares 0,000 *!tal C!ntri$uted Capital "etained +arnins/ "etained +arnins ppr!priated !r *reasury Shares P 0,000 nappr!priated "etained +arnins 4,10,000 *!tal C!ntri$uted Capital and "etained +arnins ess *reasury Shares, at !st (5,000 shares) *!tal Shareh!lders3 +uity ? @!r< sheet may $e prepared t! ailitate !mputati!n ! the a$!e $alanes.

P1%,000,000

%,555,000 P22,555,000

4,0,000 P2%,#5,000 0,000 P2%,%5,000

Problem 10 – 4

1. 2. . 4.

ssets 7 I I I 9+

ia$ilities 9+ 9+ 9+ 9+ 9+

S+ 7 I I I 9+

PIC 9+ I 7? 9+? 7

"+ 9+ 9+ 9+? 7? 7

Pr!it 9+ 9+ 9+ 9+ 9+


page 7

?*he indiated l!ss may $e de$ited t! the PIC arisin r!m sale ! the treasury Share Capital in 9!. 2 !r suh indiated l!ss may $e de$ited t! retained earnins. P 10-&

Aaier C!mpany Statement ! Chanes in Shareh!lders3 +uity B!r the Bisal ear +nded Aune 0, 2014

Dalanes, Aune 0, 201 Issuane ! 5,000 PSC E P140 Issuane ! 20,000 OSC E P0 "etirement ! 1,000 PSC E P150 Purhase ! 5,000 *S E P0 Share split ! 2 !r 1 "eissuane ! *S E P52 7elarati!n ! diidends PSC ' P,400,000 x 10; OSC ' 25,000 x P% Pr!it !r the year Dalanes, Aune 0, 2014

PS P,000,000 500,000

OS P1,000,000 200,000

(

100,000)

PIC P #,200,000 200,000 1,200,000 ( 40,000)

"+ P2,550,000

(

*S

10,000) P400,000

%0,000

P,400,000

P1,200,000

P10,%20,000

( 200,000) ( 40,000) ( 1,410,000) 50,000 P1,540,000

P200,000

3$TIPE CHOICE

FC10-1



*!tal pr!it sine in!rp!rati!n *!tal ash diidends paid *!tal alue ! share apital diidends distri$uted "etained earnins, end

P 420,000 ( 10,000) ( 0,000 ) P 2%0,000

FC10-2

D

1: - 40,000 sh x P12 12:2 - %,000 sh x P1 12:1- Pr!it !r the year *!tal shareh!lders3 euity, 12:1:14

FC10-

D

P15 par x 2 ' P0 ¸ 5

FC10-4

C

200,000 sh ¸ 2 ' 100,000 sh x P5

FC10-5



15,000 sh x  x p25

P1,125,000

FC10-%



1:1:12 100,000 sh x P15 2012& 2014 - Pr!it - Cash diidends 1:10:14 - *reasury Shares (%,000 sh x P12) 11:20:12 - "eissue ! *reasury Shares (4,000 sh x P) *!tal shareh!lders3 euity

P1,500,000 450,000 ( 20,000) ( 2,000) 2,000 P1,%0,000

FC10-

D

4,000 shares x P4 ' P1%,000

FC10-



Pr!eeds r!m sale ! treasury Share Capital C!st ! treasury Share Capital Paid-in apital r!m sale ! treasury Share Capital

P 40,000 ( ,000) 00,000 P 02,000 P%.00 500,000 shs

P 210,000 120,000 P #0,000


FC10-# FC10-10 T3 4 1. * 2. B . B 4. B 5. B

D D

page 8

(100,000 >10,000) x 2 ' 220,000 & G(5,000 & 1,000) x 2H ' 212,000 (40,000 x P105) & (%00 x P110) > (400 x P#5) > P0,000 & P200,000 ' P4,02,000

%. . . #. 10.

* * * B *

11. 12. 1. 14. 15.

* * B B *

1%. 1. 1. 1#. 20.

B B * * B

T3 50 1. *reasury shares 2. C!nerti$le preerene shares . St!< !r share split : share split-up 4. "eapitali=ati!n 5. Paid-in Capital r!m "etirement ! Share Capital %. C!st meth!d . Share split d!@n : reerse share split . "etained +arnins #. 7erease 10. "etained ppr!priated !r *reasury shares 11. Fem!randum entry 12. Sellin prie 1. C!ntri$uted Capital 14. "eauisiti!n $y d!nati!n 15. "etirement ! share apital T3 51 1. 7 2, C . 7 4.  5. D %.  . 7 . C #. C 10. 7 11.  12.  1. C 14. D 15. D 1%. 

1. 1.

 C

%,000 x P20 ' P120,000 (same as $e!re the Share Capital split) 20,000 x P0 ' P%00,000 uth!ri=ed - 10,000 Issued - 4,400 Outstandin - 4,400 - 500 ' ,#00 uth!ri=ed - 10,000 x 2 ' 20,000 Issued - (4,400 > 100) x 2 ' #,000 Outstandin - (4,400 - 500 > 100) x 2 ' ,000 P1,%50,000 - (1,000 shares x P40) ' P1,%10,000 100,000 shares x P0 ' P,000,000 'OTE( 2010 shoul be 2015


1#. 20.

D D

page 9

(100,000 sh x P50) > (5,000 sh x P20) - (15,000 sh x P15) ' P4,5,000 100,000 shares x  - 00,000 shares - 15,000 shares ' 25,000 shares

T3 52 Pr!$lem / Outstaning Shares 1. 20,000 2. 400,000 . 400,000 4. 200,000 5. 1#5,000

Orinar. Share Capital P 4,%00,000 4,000,000 ,000,000 ,000,000 ,#00,000

A6l Pai-In Capital P1,50,000 1,200,000 1,200,000 2,200,000 1,10,000

T3 5 a. Preerene Share Capital (500 sh x P100) Preerene Share Premium (500 sh x P20) Paid-In Capital r!m "etirement ! PSC Cash (500 sh x P115)

PSC ,500 shs $.

d.

2,500 5,500

OSC 10,000 shs 25,000

Cash *reasury Shares Paid-In Capital r!m Sale ! *reasury Shares

2,000

25,000

25,000 ,000

OSC 10,000 shs

Preerene Share Capital (1,000 sh x P100) Preerene Share Premium (1,000 sh x P20) Ordinary Share Capital (1,000 sh x 4 x P20) PIC r!m C!nersi!n ! PSC int! OSC PSC ,000 shs

TSE P10,%00,000 10,%00,000 10,%00,000 10,%00,000 10,40,000

50,000 10,000

*reasury Shares (1,000 sh x P25) Cash

PSC 4,000 shs .

Retaine Earnings P4,%50,000 5,400,000 1,400,000 5,400,000 5,400,000

100,000 20,000 0,000 40,000

OSC 14,000 shs

Ordinary Share Capital, P20 par Ordinary Share Capital, P5 par PSC 4,000 shs OSC 40,000 shs

200,000 200,000

APC_ch10sol.2014

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