All of the following will affect the retained earnings account, except Adjustment due to overstatement of depreciation expense from previous reporting period and was known only this current year Issuance of treasury shares at P 29 per share when its cost is P 25 per share Quasi-reorganization thru recapitalization Declaration of 10% bonus issue
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- 2. All of the following will affect the retained earnings account, except a. Declaration of 10% bonus issue b. Quasi-reorganization thru recapitalization c. Adjustment due to overstatement of depreciation expense from previous reporting period and was known only this current year d. Issuance of treasury shares at P 29 per share when its cost is P 25 per share 3. Which of the following changes the total shareholder's equity balance? a. Declaration of large bonus issue b. Declaration of cash dividends c. Issuance of share certificates due to subscription receivable fully paid d. Issuance of share rights6. An entity provided the fo:louingdata for the year ended December 31. 2019:Retained earnings unappropriated. Januar> Overdepreciation of20i 8 due to prior period error. net oftax 400.000Net incomeRetained earning; appropriated for treasury (original balance is 3,000,000but reduced S) P200,000 by reason of reissuance of the treasury Shares)Retained earnings eppropria:ed for contingencies (begirråpg balance P70C,OOO. 300,000but increased by current appropriation ofP 100,000) 800,000Cash dividends paid to shareholders 1000.000Change in accounting policy from FIFO to a average — credit, net OftaxWhat is the balance of unappropriated retained earnings on December 31, 2019? 4,500.000 300.000b. 4,800,000Increase (Decrease) P592,500 Cash Account receivable, net Inventory Investments Accounts payable Bonds payable Ordinary share capital Share premium 1,422,000 (750,000) (352,500) (382,500) 615,000 450,000 30,000 There were no entries in the retained earnings account except for net income and a dividend declaration of P590,000, which was paid in the current year. REQUIRED: 1. Net increase (decrease) in net assets 2. Net income for the current year
- 1. What amount of retained earnings should be appropriated as a result of the given transactions? a. Dividend on its 50,000 shares of 10%, P100 par value cumulative preference share capital have not been declared or paid for 3 years. b. Treasury ordinary shares were acquired ar a cost of P1,000,000 during the year. The treasury share had not been reissued as of year-end. c. At year-end, IRON MAN appropriated P3,000,000 of retained earnings for the construction of a new plant. d. Also, P2,000,000 of cash was restricted for the retirement of bonds payable due in the next year. Choices: A. 1,150,000B. 3,000,000C. 5,000,000D. 5,500,000E. 6,500,000F. 7,500,0001. What amount of retained earnings should be appropriated as a result of the given transactions? a. Dividend on its 50,000 shares of 10%, P100 par value cumulative preference share capital have not been declared or paid for 3 years. b. Treasury ordinary shares were acquired ar a cost of P1,000,000 during the year. The treasury share had not been reissued as of year-end. c. At year-end, IRON MAN appropriated P3,000,000 of retained earnings for the construction of a new plant. d. Also, P2,000,000 of cash was restricted for the retirement of bonds payable due in the next year.Kalinga Company reported the following adjusted account balances at year-end: Share capital 15,000,000 Share premium 5,000,000 Treasury shares, at cost 2,000,000 Actuarial loss on defined benefit plan 1,000,000 Retained earnings unappropriated 6,000,000 Retained earning appropriated 3,000,000 Revaluation surplus 4,000,000 Cumulative translation adjustment- credit 1,500,000 REQUIRED: What amount sjould be reported as shareholder's equity at year-end? a. 31,500,000 b. 32,500,000 c. 28,500,000 d. 25,500,000
- 5. An entity provided the following data for the year ended December 1, 2019: Retained earnings unappreciated, January 1 P2 000 000 Overdepreciation of 2018 due to prior period, net of tax 400 000 Net Income 3 000 000 Retained earnings appreciated for treasury shares (original balance is P500 000 but reduced by P200 000 by reason of reissuance of the treasury shares) Retained earnings appropriated for contingencies (beginning balance P700 000 but increased by current appreciation of P100 000) Cash dividends paid to shareholders Change in accounting policy from FIFO to a average-credit, net of tax • What is the balance of unappreciated retained earnings on December 31, 2019?1.The changes in account balances of ENIGMA Co. during 2020 are as follows: Assets: P133,500 increase Liabilities: P40,500 decrease Ordinary share capital: P90,000 increase Share premium: P9,000 increase. Assuming there are no changes in retained earnings except for net income and a dividend payment of P19,500, how much is the net income (net loss) for 2020? 2.The financial records of DISGRASYA Inc. were destroyed by fire at the end of 2020. Selected information gathered are the following: Inventory on January 1 was P92,000 and decreased by 20% during the year. Sales discount amounted to P17,000. Interest expense is P20,000. Cost of sales is P500,000. Administrative expenses amounted to 20% of cost of sales but only 8% of gross sales. Two thirds of operating expenses relate to sales activities. The company is subject to 30% income tax. How much is the net income (net loss) during 2020? Thank You!Problem 5-9 (AICPA Adapted) Kalinga Company reported the following adjusted account balances at year-end: Share capital Share premium Treasury shares, at cost Actuarial loss on defined benefit plan Retained earnings unappropriated Retained earnings appropriated Revaluation surplus Cumulative translation adjustment - credit 15,000,000 5,000,000 2,000,000 1,000,000 6,000,000 3,000,000 4,000,000 1,500,000 What amount should be reported as shareholders' equity at year-end? a. 31,500,000 b. 32,500,000 c. 28,500,000 d. 25,500,000
- The following are the changes in all the account balances of Kenji Company during the year ended December 31, 20x1, except for retained earnings. Increase (Decrease) P1,185,000 2,844,000 (1,500,000) 705,000 (765,000) 1,230,000 900,000 60,000 Cash Account receivable, net Inventory Investments Accounts payable Bonds payable Ordinary share capital Share premium There were no entries in the retained earnings account except for net income and a dividend declaration of P1,180,000, which was paid in the current year. REQUIRED: 7. Net increase (decrease) in net assets 8. Net income for the current yearIncome Statement and Retained Earnings Huff Company presents the following items derived from its December 31, 2019, adjusted trial balance: The following information is also available for 2019 and is not reflected in the preceding accounts: 1. The common stock has been outstanding all year. A cash dividend of 1.28 per share was declared and paid. 2. Land was sold at a pretax gain of 6,300. 3. Division X (a major component of the company) was sold at a pretax gain of 4,700. It had incurred a 9,500 pretax operating loss during 2019. 4. A tornado, which is an unusual event in the area, caused a 5,400 pretax loss. 5. The income tax rate on all items of income is 30%. 6. The average shareholders equity is 90,000. Required: 1. Prepare a 2019 multiple-step income statement for Huff. 2. Prepare a 2019 retained earnings statement. 3. Compute the 2019 return on common equity (Net Income 4 Average Shareholders Equity).The changes in account balances of Smile Co. during 2020 are as follows: Assets: P133,500 increase Liabilities: P40,500 decrease Ordinary share capital: P90,000 increase Share premium: P9,000 increase. Assuming there are no changes in retained earnings except for net income and a dividend payment of P19,500, how much is the net income (net loss) for 2020?