Question
In: Finance
Case 2: Reporting shareholders’ equity (5 marks) Vinabread Ltd had the following equity account on 1...
Case 2: Reporting shareholders’ equity
Vinabread Ltd had the following equity account on 1 July 2020:
Share Capital (100,000 shares) 1,800,000
Retained Earnings $ 960,000
General Reserve $ 100,000
Vinabread Ltd’s profit for the year ending 30 June 2020, which has not been included in the retained earnings was $180,000. During the year, the following transactions and events occurred:
July 15, 2020 Declared and paid interim dividend of $0.50 per share.
July 30, 2020 Effected 3 for 1 share split,
June 30, 2021 Declared a final cash dividend of $0.30 per share and transferred $20,000 from retained earnings to general reserve.
Required: Prepare the equity section of the statement of financial position of Vinabread Ltd as at 30 June 2021.
Solutions
Expert Solution
| Vinabread Ltd | ||
| a | No of outstanding common shares on Jul 15 | 100,000 |
| b. | Total interim dividend paid @$0.5/share on Jul 15= | 50,000.0 |
| c | No of outstanding common shares on Jul 30 after 3 for 1 share split = | 300,000 |
| d | June 30,2021 total cash dividend declared @$0.3 = | 90,000.0 |
| Retained Earning statement : | |
| Opening balance Jul 1,2020 | $ 960,000 |
| Add , Earning fr the year ended Jun 30,2020 | $ 180,000 |
| Less Interim dividend paid Jul 15,2020 | $ 50,000 |
| Less Final dividend paid Jun30,2021 | $ 90,000 |
| Less : Transfer to Gen reserve on Jun 30,2021 | $ 20,000 |
| Closing balance Jun 30,2021 | $ 980,000 |
| Vinabread Ltd | |
| Partial Balance Sheet as on Jun 30.2021. | |
| Equity Section | |
| Share Capital (300,000 issued, $6 par value) | $ 1,800,000 |
| General Reserve | $ 120,000 |
| Retained Earning | $ 980,000 |
| Total Equity | $ 2,900,000 |
jeff jeffy answered 1 year agoRelated Solutions
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Paid-in capital—excess of par, common
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Paid-in capital—excess of par, common
514,000
Paid-in capital—excess of par, preferred
135,000
Preferred stock, $100 par, 13,500 shares outstanding
1,350,000
Retained earnings
2,700,000
Treasury stock, at cost, 5,700 shares
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During 2021, Gerlach Inc. had several transactions relating to
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Declared a property dividend of 100,000 shares of Slowdown
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On January 1, 2021, Fascom had the following account balances in its shareholders' equity accounts. Common...
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its shareholders' equity accounts.
Common stock, $1 par, 253,000 shares issued
$
253,000
Paid-in capital–excess of par, common
506,000
Paid-in capital–excess of par, preferred
115,000
Preferred stock, $100 par, 11,500 shares outstanding
1,150,000
Retained earnings
2,300,000
Treasury stock, at cost, 5,300 shares
26,500
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common stock.
January
15:
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On January 1, 2017, Fascom had the following account balances in its shareholders' equity accounts. Common...
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its shareholders' equity accounts.
Common stock, $1 par, 250,000 shares issued
250,000
Paid-in capital–excess of par, common
500,000
Paid-in capital–excess of par, preferred
100,000
Preferred stock, $100 par, 10,000 shares issued
1,000,000
Retained earnings
2,000,000
Treasury stock, at cost, 5,000 shares
25,000
During 2017, Fascom Inc. had several transactions relating to
common stock.
January 15:
Bought for retirement 10,000 common shares at $ 5 per share.
February 17:
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par, 248,000 shares issued 248,000 Paid-in capital - excess of par,
common 496,000 Paid-in capital - excess of par, preferred 160,000
Preferred stock, $100 par, 16,000 shares outstanding 1,600,000
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par, 240,000 shares issued 240,000 Paid-in capital - excess of par,
common 480,000 Paid-in capital - excess of par, preferred 200,000
Preferred stock, $100 par, 20,000 shares outstanding 2,000,000
Retained earnings 4,000,000 Treasury stock, at cost, 4,000 shares
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to common stock. January 15: Declared a property dividend of
100,000 shares of Slowdown...
On January 1, 2015, Thomson Inc. had the following account balances in its shareholders' equity accounts....
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balances in its shareholders' equity accounts.
Common stock, $1 par, 250,000 shares issued of
which 3,000 Shares being held as treasury
stock
$250,000
Paid-in capital excess of par,
common
500,000
Preferred stock, $100 par, 10,000 shares
outstanding 1,000,000
Paid-in capital excess of par, preferred
100,000
Retained earnings
2,000,000
Treasury stock, at cost, 3,000 shares
15,000
...
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balances in its shareholders' equity accounts.
Common stock, $1 par, 250,000
shares issued
250,000
Paid-in capital—excess of par,
common
500,000
Paid-in capital—excess of par,
preferred
100,000
Preferred stock, $100 par,
10,000 shares outstanding
1,000,000
Retained earnings
2,000,000
Treasury stock, at cost, 5,000
shares
25,000
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common stock.
January 15:
Declared a property dividend of
100,000 shares of Slowdown
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in its shareholders' equity accounts.
Common
stock, $1 par, 350,000 shares issued of
which
20,000 Shares being held as treasury stock
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Paid-in
capital excess of par, common
500,000
Preferred
stock, $100 par, 10,000 shares outstanding
1,000,000
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100,000
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earnings
2,000,000
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60,000
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common stock.
2/10...
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