BM2403

NAME: Curada, Maria Teresita P.__ DATE: 04/10 /2024 SCORE: _____________

eLMS Activity
The Shareholders’ Equity section of ACCA Company on December 31 shows the following:

Ordinary Share Capital, P50 par, 105,000 shares issued P 5,250,000

Share Premium – ordinary shares 1,010,000
Treasury Shares, 5,000 shares 300,000
Retained Earnings 10,000,000

Required: Provide the journal entries to be made under the following independent assumptions:
1. The company declared 10% share dividends on the ordinary share when the market value per
share is P130.

Shares = 105,000 x 10% = 10,500 shares

= 10,500 shares x P130 = P1,365,000
Journal entry:
Retained Earnings P1,365,00
0
Share Dividends Payable (10,500 x P525,000
P50)
Share Premium (10,500 x P80) P840,000

2. The company declared 20% share dividends on the ordinary share when the market value per
share is P130.

Shares = 105,000 x 20% = 21,000 shares

= 21,000 shares x P50 = P1,050,000
Journal entry:
Retained Earnings P1,050,000
Share Dividends Payable (21,500 x P1,050,000
P50)

04 Worksheet 4 *Property of STI

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 BM2403

3. The company declared and paid P2 per share liquidating dividends.

Outstanding shares issued 105,000

Less: Treasury shares 5,000
Outstanding shares 100,000
Multiply: Value declared and paid per share P2
Retained Earnings P200,000

Journal entry for declaration of dividends:

Retained Earnings P200,000
Share Dividends Payable P200,000

Journal entry for payment of dividends:

Share Dividends Payable P200,000
Retained Earnings P200,000

4. Assume instead that the 5,000 treasury shares were declared as share dividends.

Treasury shares = 5,000 shares = P300,000

Journal entry for declaration of dividends:

Retained Earnings P300,000
Share Dividends Payable P300,000

Journal entry for payment of dividends:

Share Dividends Payable P300,000
Retained Earnings P300,000

04 Worksheet 4 *Property of STI

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