NAME : ___________________________ DATE TODAY : ______________________

SECTION : _________________________

PROBLEM SOLVING

Problem 1

Pau Corporation was authorized to issue the following shares:

a. Ordinary shares (400,000 in number with a par value of Php10 per share)
b. 10% preference shares (300,000 in number with a par value of Php10 per share)

The issue price of all the ordinary and preference shares which were subscribed and issued were Php12.00 and
Php14.00 per share, respectively.

• The corporation issued 120,000 ordinary shares. The unpaid balance on the 15,000 subscribed ordinary
shares amounted to Php90,000.
• The corporation also issued 90,000 preference shares, 30,000 of which were subscribed but not paid for.
The unpaid balance is Php120,000.
• The corporation also issued 90,000 preference shares, 30,000 of which were subscribed but not paid for.
The unpaid balance is Php120,000.

Requirement:

a. How much is the total Share Capital (in peso), both Ordinary and Preference of the corporation?
b. How much is the total Share Capital (in number of shares), both Ordinary and Preference of the corporation?
c. How much is the total balance of Share Premium account, both ordinary and preference?
d. How much is the total Subscribed Share Capital
e. How much is the Legal Capital
f. How much is the total amount of Stockholder’s Equity?

Activity 2 : Corporatiob 1
Problem 2

Angel Corporation was incorporated on August 1, 2021 with an authorized share capital of Php5,000,000 divided into
500,000 shares with a par value of Php10 per share.

At the time of incorporation, 30% of the authorized share capital was subscribed at par value. The incorporators who
paid their subscriptions in full were issued 90,000 ordinary shares, but 40% of the balance of the subscriptions of
incorporators who have yet to pay their subscriptions in full remained unpaid as of December 31, 2021.

Subsequent to incorporation, 80,000 ordinary shares were subscribed at Php12 per share. Of these shares, 30,000
were issued as of December 31, 2021.The remaining 50,000 shares had an unpaid balance of 3% of the total
subscription price.

Requirement:
a. How much is the total Share Capital of Angel Corporation?
b. How much is the total Subscribed Ordinary Share?
c. How much is the Legal Capital
d. How much is the total Shareholder’s Equity?

Activity 2 : Corporatiob 2
Problem 3

Pau Corporation presented the following information:

Requirement:
a. How much is the Legal Capital?
b. How much is the Shareholder’s Equity?

Activity 2 : Corporatiob 3
Problem 4

Edison Tech Corporation was organized on February 3, 2019 with authorized share capital consisting of 200,000
shares of Php 70 par value 12% preference share capital and 400,000 shares of ordinary share capital with Php 40
stated value. The following transactions occurred during February and March:

Requirement:

a. Prepare All Journal Entries using Memorandum Method

b. Prepare All Journal Entries using Journal Entry Method

Activity 2 : Corporatiob 4