Beruflich Dokumente
Kultur Dokumente
Cash Dividends
1. On December 1, 2018, Synthetic Corp. owns 15,000 ordinary shares representing 15% of the shares
outstanding of Prowess Corporation. During the same date, Prowess declared P2 per share dividends
on ordinary shares to the shareholders of record on December 15 payable on December 31.
a. Prepare all the necessary entries at the
- Date of declaration
- Date of record
- Date of payment
b. How much is the dividend income to be recognized on 2018.
Property Dividends
2. Doused Company owns 15% of the outstanding ordinary shares of Albeit Corp. On November 1, 2018,
Albeit declared its inventory as property dividends. Data relating to the fair values of the inventory
follow:
Date Total Fair Values of Property Dividends
November 1, 2018 P250,000
December 31, 2018 P450,000
February 15, 2019 P410,000
a. Prepare all the necessary entries at the
- Date of declaration
- Date of record
- Date of payment
b. How much is the dividend income to be recognized on 2018.
Share Dividends
3. On October 1, 2018, Contentious Corp owns 15,000 fair value through other comprehensive income
ordinary shares at a cost of P1,500,000. The shares represent 15% of the ordinary shares outstanding
of Pulsate Corporation.
Record the receipt of the share dividends on the Contentious’ books under each of the assumption
listed below:
Case No. 1: Assuming the shares are investment in unquoted securities measured at cost:
1. Contentious received 15% ordinary shares as Share Dividends.
2. Contentious received 1,500 preference shares as Share Dividends. The par value of the preference
share is P200 per share while the ordinary shares has a par value of P100.
Case N0. 2: Assuming the shares are financial assets at fair value through profit or loss
3. Contentious received 15% ordinary shares as Share Dividends. The fair value of the ordinary shares
amounted to P100.
4. Contentious received 1,500 preference shares as Share Dividends. The fair value of each
preference share is P150.
Case No. 3: Assuming the shares are investment in equity securities designated as at fair value though
other comprehensive income
5. Contentious received 15% ordinary shares as Share Dividends. The fair value of the ordinary shares
amounted to P100.
6. Contentious received 1,500 preference shares as Share Dividends. The fair value of each
preference share is P150.
Liquidating Dividends
6. On January 2, 2018, Earth Company has 20,000 shares of P100 par value ordinary shares. The shares
were acquired a year ago at a cost of P440,000. On February 14, of the current year, Earth Company
received 15% cash, liquidating dividends from the Investee Corporation.
a. Assuming that the Investee Corporation is a wasting asset corporation and partial liquidation, how
much is the amount of loss on liquidation to be recognized in 2018?
b. Assuming that the Investee Corporation is a wasting asset corporation and partial liquidation,
provide the relevant entries.
c. Assuming that the Investee Corporation is other than a wasting asset corporation, how much is the
amount of loss on liquidation to be recognized in 2018?
d. Assuming that the Investee Corporation is other than a wasting asset corporation and partial
liquidation, provide the relevant entries.
Stock Right
On June 15, 2018, Mars Company owns 10,000 shares with a cost of P700,000 of Moon Company’s
stocks