Treasury Shares originally issued

reacquired but not retired or cancelled

own shares

issue money to the corporation

reacquire money to the shareholders

Treasury Shares always accounted at COST

debited and credited at Reacquistion Cost

Purchased
Cash face value
Non Cash carrying amount of the non cash asset surrendered
book value of the asset corporation

reacquisition shares is limited to the unrestricted retained earnings

Treasury Shares xx at cost

Cash xx at cost

5,000 ordinary shares Cash 600000

100 par value par OSC
120 per share original issuances SP

2000 shares reacquired

110 per share reacquistion cost Treasury Shares 220000
Cash

Reissue at reacquistion cost 110 per shar Cash 220000

Treasury Shares

above reacquisition cost 130 per shar Cash 260000

excess goes to Share Premium Treasury Shares
Share Premium

1000 shares
120 Cash 240000
Treasury Shares
Share Premium

below reacquision cost 1000 shares Cash 90000

1. Share premium of treasury of the same class 90 Share Premium - TS 20,000
2. Retained Earnings Treasury Shares

1000 SHARES Cash 80000

 80 Share Premium - TS 20,000
Retained Earnings 10,000
Treasury Shares

Retirement - Cancel share capital account is debited at PAR

treasury account is credited at cost
any gain or loss is reported

GAIN Share Premium

Reacquision Price < Par Value

LOSS 1. Share Premium from Original Issuance

Reacquision Price > Par Value 2. Share Premium from Treasury Shares
3. Retained Earnings

1000 ordinary shares P100 par at 120 per share

reacquire 500 shares at P80 per share
retire/cancell 250 shares

Issue Cash 120000

OSC 100000
Share Premium 20000

Reacquire Treasury Shares 80000

Cash 80000

To cancel the shares

OSC 25000
Treasury Share 20000
Share Premium

Donated Shares actually treasury shares

at point of donation no entry only a memordandum entry

at date of resale Cash/PPE xx

Donated Capital xx

at date of retirement
 debit share capital account at par
credit donated capital at par

1000 ordinary shares P100 par at 120 per share

1000 shares are donated to the corporation
resold at 150 per share

Issue Cash 120000

OSC 100000
Share Premium 20000

at date of no entry

at date of Cash 150000

Donated Capital 150000

500 resale
500 retire Cash 75000
Donated Capital 75000

OSC 50000
Donated Capital 50000

RECAPITALIZATION
there is a change in the capital structure of the entity
BUT NO CHANGE IN TOTAL SHARE HOLDERS EQUITY

1 CHANGE FROM PAR TO NON PAR

2 CHANGE FROM NO PAR TO PAR
3. REDUCTION OF PAR VALUE
4. REDUCTION OF STATED VALUE
5 SPLIT UP
6 SPLIT

Before Recapilization
OSC 100 50,000 5,000,000
Share Premium 500,000 5,500,000 110
Retained Earnings 2,500,000
8,000,000

50,000 cancelled no par stated value 50

Issuance Cash 5500000

OSC 5000000
 Share Premium 500000

Cancel OSC 5000000

Share Premium 500000
OSC 2500000
Share Premium 3,000,000

After Recapitalization
OSC 2500000
Share Premium 3,000,000
Retained Earnings 2,500,000
8000000

Before Recapilization
OSC 100 50,000 5,000,000
Share Premium 500,000
Retained Earnings 2,500,000
8,000,000

50,000 cancelled no par stated value 150

Issuance Cash 5500000

OSC 5000000
Share Premium 500000

Cancel OSC 5000000

Share Premium 500000
Retained Earnings 2,000,000
OSC 7500000

After Recapitilization OSC 7,500,000

Share Premium 0
Retained Earnings 500,000
8,000,000

Reduction in Par/Stated Value

100 par/stated value before recap

80 par/stated value after recap

excess over par or stated value before recap against

after recap is debited to OSC and credited to share premium
 Before Recapilization
OSC 100 50,000 5,000,000
Share Premium 500,000
Retained Earnings 2,500,000
8,000,000

80 50,000 4000000

OSC 1,000,000 20 1000000

Share Premium 1,000,000

Split Up/Split Down

does not affect the total shareholders equity and share capital account
only the number of shares outstanding

Split Up increase number of shares

lower par value

Split Downincresae number of shares

higher par value

Before Recapilization
OSC 100 50,000 5,000,000
Share Premium 500,000
Retained Earnings 2,500,000
8,000,000

Split Up 5 is to 1 250000
20 5000000

Split Down
Before Recapilization
OSC 100 50,000 5,000,000
Share Premium 500,000
Retained Earnings 2,500,000
8,000,000

1 is to 5 10000
500 5000000

RIGHTS ISSUE pre emptive right

OSC Share Warrants

Issuance Share WARRANTS WITHOUT CONSIDERATION
AT ISSUANCE NO ENTRY

AT EXPRIATION NO ENTRY

Exercise usual entry for issuance of share capital

PSC issued with share warrants

the consideration received is allocated between the preference share
and the warrants on the basis of their market value

20,000 preference shares

100 par value
20,000 share warrants 10,000 50 par value
60 pesos
3,250,000
mv preference shares 120
mv of share warrants 10

3,250,000
mv preferenc 20,000 120 2400000 24/26 3000000
mv share war 20,000 10 200000 2/26 250000
2600000 3,250,000

Cash 3,250,000
PSC 2000000
SP - OSC 1000000
Share Warrants Outstand 250,000 reported as part of the sh
exercise - included as part
at exerciseCash 300000
10,000 Share Warrants Outstand 125000
OSC 250000
Share Ppremium 175,000

Total Consideration 300,000

SWO 125,000
PAR 250,000
425,000
175,000

at retired Share Warrants Outstanding 125,000

Share Premium 125,000
500000
100000

220000

220000

220000
40000

220000
20000

110000
 110000

1000 ordinary shares P100 par at 120 per share

reacquire 1000 shares at P110 per share
retire/cancell 250 shares

Issue Cash 120000

OSC 100000
Share Premium 20000

Recquire Treasury Shares 110000

1000 Cash 110000

Reissue Cash 60000

500 Treasury Shares 55000
120 Share Premium - TSC 5000

Retired & Cancelled

OSC 50000
5000 Share Premium - OSC 5000
Treasury Shares 55000
reported as part of the share premium
exercise - included as part of the consideration