MEJ

Chapter 30 – Book Value and Earnings Per Share
CHAP
APTER 30: BOOK VALUE
AND
EARNIN
INGS
PER
SHARE
PROB
OBLEM 30-1 One Clas
ass s of Share
ares
Total shareholders' equity 16,220,000
Add: Subscription receivable 1,200,000
Total SHE excluding subscription receivable 17,420,000
Divided by:O rdinarys hares outstanding* 200,000
Book value per share (A) 87.10
Shares issued 200,000
Add: Subscribed shares (P1,000,000 / P50 par) 20,000
Less: Treasury shares 20,000
Ordinary shares outstanding 200,000
PROB
OBLEM 30-2 Two Clas
asses of Share
res - Prefer
ference and Ordi
dinary
Share
res
Total
Preference shares:
Shares par valu
lue
Preference share capital issued 12,500 P5,000,000
Add: Subscribed preference shares - -
Total
12,500 P5,000,000
Less: Treasury shares at par - -
Shares outstanding and total par value 12,500 P5,000,000
Ordinary shares:
Shares
Total
par valu
lue
Ordinarys harec apitali ssued 75,000 P3,000,000
Add: Subscribed ordinary shares - -
Total
75,000 P3,000,000
Less: Treasury shares at par - -
Shares outstanding and total par value 75,000 P3,000,000
Total shareholders' equity 15,000,000
Less: Par value of outstanding preference shares 5,000,000
Par value of outstanding ordinary shares 3,000,000
Excess over par 7,000,000
Ques
estion No.
1 & 2
CASE
NO. 1
Excess
293
Preference
Ordinary
Balances
over par
P7,000,000
shares
P5,000,000
shares
P3,000,000
Preference dividend
(5,000,000 x 8% x 4) (1,600,000) 1,600,000
Balancet o ordinarys hares 5,400,000 5,400,000