Pido, Rea Lee Joy 21/05/21
The Gallery Company is authorized to issue 100,000 shares of P500 par value ordinary share capital.
Gallery has the following transactions during the month:
• Issued 20,000 shares at par, receiving cash.
• Issued 250 shares to attorneys for services in securing the corporate charter and for preliminary legal
costs of organizing the corporation. The value of the services was P150, 000.
• Issued 12,500 ordinary shares in exchange for a land and a building with fair values of P5, 000,000 and
P3, 000,000, respectively.
• Received cash for P6, 500 ordinary shares sold at P550 per share.
• Received subscription for 20,000 shares at P550 per share, receiving 25% down.
• Collected balance of the subscription price on the 12,000 shares subscribed above and share
certificates were accordingly issued.
ANSWER:
Cash (20,000 x 500) 10,000
Ordinary share capital 10,000
Legal expense 150,000
Ordinary share capital (250x500) 125,000
Share premium-ordinary 25,000
Land 5,000,000
Building 3,000,000
Ordinary share capital (12,500 x 500) 6,250,000
Share premium-ordinary 1,750,000
Cash (6,500 x550) 3,575,000
Ordinary share capital (6,500 x 500) 3,250,000
Share premium-ordinary 325,000
The Gallery Company is authorized to issue 100,000 shares of P500 par value ordinary share capital.
Gallery has the following transactions during the month:
• Issued 20,000 shares at par, receiving cash.
• Issued 250 shares to attorneys for services in securing the corporate charter and for preliminary legal
costs of organizing the corporation. The value of the services was P150, 000.
• Issued 12,500 ordinary shares in exchange for a land and a building with fair values of P5, 000,000 and
P3, 000,000, respectively.
• Received cash for P6, 500 ordinary shares sold at P550 per share.
• Received subscription for 20,000 shares at P550 per share, receiving 25% down.
• Collected balance of the subscription price on the 12,000 shares subscribed above and share
certificates were accordingly issued.
ANSWER:
Cash (20,000 x 500) 10,000
Ordinary share capital 10,000
Legal expense 150,000
Ordinary share capital (250x500) 125,000
Share premium-ordinary 25,000
Land 5,000,000
Building 3,000,000
Ordinary share capital (12,500 x 500) 6,250,000
Share premium-ordinary 1,750,000
Cash (6,500 x550) 3,575,000
Ordinary share capital (6,500 x 500) 3,250,000
Share premium-ordinary 325,000
