Chapter 1 Problem 10-15 to 20
Problem 10-15 Answer A
Purchase price (4,000 x P100) 400,000
Brokerage 12,000
Total 412,000
Less: Dividend purchased (4,000 x 5) 20,000
Acquisition cost 392,000
Problem 10-16 Answer D
Fair value of asset given (land) 3,000,000
Problem 10-17 Answer D
Original shares acquired January 15 50,000
Stock dividend on March 31 (20% x 50,000) 10,000
Total shares 60,000
Dividend income – cash dividend on December 15 (60,000 x 5) 300,000
Problem 10-18 Answer C
Dividend income – cash dividend on July 1 100,000
Original shares on March 1 20,000
Stock dividend on December 1 (10% x 20,000) 2,000
Total shares 22,000
Problem 10-19 Answer B
Original shares on October 1, 2007 40,000
Stock dividend on November 30, 2008 (10%) 4,000
Total shares 44,000
Shares sold on December 31, 2008 ( 4,000)
Balance 40,000
Sales price 1,000,000
Cost of shares sold (4,000/44,000 x 6,600,000) ( 600,000)
Gain on sale 400,000
Problem 10-20 Answer B
Shares received as property dividend (5,000/5) 1,000
Dividend income (1,000 x 100) 100,000
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