Scribd Logo
Upload

Welcome to Scribd!

  • 223 views

    Retained Earnings

    Uploaded by

    Christian Marvin Villanueva
    The document summarizes the ledger of Fernando Corporation as of January 2, 2014 and transactions that occurred during the year. It provides balances for share capital, share premium, appropriation reserves, retained earnings, and treasury shares. Transactions included declaring and paying cash dividends, increasing appropriation reserves, selling treasury shares, declaring a scrip dividend, and recording net income. The required items are entries to record the transactions and compute the ending retained earnings balance.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd

    Retained Earnings

    Uploaded by

    Christian Marvin Villanueva
    223 views3 pages
    The document summarizes the ledger of Fernando Corporation as of January 2, 2014 and transactions that occurred during the year. It provides balances for share capital, share premium, appropriation reserves, retained earnings, and treasury shares. Transactions included declaring and paying cash dividends, increasing appropriation reserves, selling treasury shares, declaring a scrip dividend, and recording net income. The required items are entries to record the transactions and compute the ending retained earnings balance.

    Original Description:

    acctg

    Original Title

    Retained_Earnings

    Copyright

    © © All Rights Reserved

    Available Formats

    XLSX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    The document summarizes the ledger of Fernando Corporation as of January 2, 2014 and transactions that occurred during the year. It provides balances for share capital, share premium, appropriation reserves, retained earnings, and treasury shares. Transactions included declaring and paying cash dividends, increasing appropriation reserves, selling treasury shares, declaring a scrip dividend, and recording net income. The required items are entries to record the transactions and compute the ending retained earnings balance.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    223 views3 pages

    Retained Earnings

    Uploaded by

    Christian Marvin Villanueva
    The document summarizes the ledger of Fernando Corporation as of January 2, 2014 and transactions that occurred during the year. It provides balances for share capital, share premium, appropriation reserves, retained earnings, and treasury shares. Transactions included declaring and paying cash dividends, increasing appropriation reserves, selling treasury shares, declaring a scrip dividend, and recording net income. The required items are entries to record the transactions and compute the ending retained earnings balance.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    You are on page 1of 3

    An examination of the ledger of Fernando Corporation revealed the following balances on January 2, 2014:

    Ordinary Share Capital, 30,000 shares authorized at a par value of P50


              (20,000 shares issued of which 1,000 are in the treasury)                         P1,000,000
    Share Premium                                                                                                                                  P600,000
    Appropriation Reserve for Plant Expansion                                                                        P50,000
    Appropriation Reserve for Treasury Shares                                                                         P36,000
    Retained Earnings Unappropriated                                                                                         P750,000
    Treasury Shares at cost, 1,000 shares                                                                                        P36,000
    The following transactions occurred during the year:
    Jan 10- Declared a P20 cash dividend per share to shareholders of record as of January 25
    Feb 4- Increased the appropriation reserve for plant expansion by P100,000
    Feb 10- Paid the dividends declared on January 10 
    May 15- Sold 700 treasury shares for P28,000. The treasury shares and the appropriation reserve were reduced accordingly.  
    June 1- Declared a 10% scrip dividend to shareholders of record as of July 1. Dividends are to be distributed on November 1 pl
    Nov 1- Paid for the scrip dividends
    Dec 31- Net income for the year amounted to P250,000
    Required:
    a. Entries to records the above transactions 
    b. Compute for ending balances of Retained Earnings 

    10-Jan Declared a P20 cash dividend per share to shareholders of record as of January 25
    Retained earnings 19,000,000
    Cash Dividends Payable 19,000,000

    4-Feb Increased the appropriation reserve for plant expansion by P100,000


    Retained earnings 100,000
    Appropriation reserve for plant expansion 100,000

    10-Feb Paid the dividends declared on January 10 


    Cash Dividends Payable 19,000,000
    Cash 19,000,000

    15-May Sold 700 treasury shares for P28,000. The treasury shares and the appropriation reserve were reduced ac
    Cash 28,000
    Treasury Shares 25200
    APIC-TS 2,800

    1-Jun Declared a 10% scrip dividend to shareholders of record as of July 1. Dividends are to be distributed on N
    Retained Earnings 1900
    Scrip Dividend Payable 1900

    1-Nov Paid for the scrip dividends


    Scrip Dividend Payable 1900
    Interest Expense 145.35
    Cash 2045.35
    31-Dec Net income for the year amounted to P250,000
    Income summary 250,000
    Retained earnings 250,000
    reduced accordingly.  
    uted on November 1 plus 18% interest.  

    Date Debit Credit


    10-Jan 19,000,000 19,000,000
    4-Feb 100,000 100,000
    10-Feb 19,000,000 19,000,000
    15-May 28,000 25200
    2,800
    1-Jun 1900 1900
    1-Nov 1900 2045.35
    145.35
    31-Dec 250,000 250,000
    Total 38,381,945.35 38,381,945.35
    Ending balance 0
    eserve were reduced accordingly.  

    e to be distributed on November 1 plus 18% interest.  

    You might also like