The Resty company issued 200,000 new P1 ordinary shares at a fair value of P1.80 each. Resty identified the following costs in relation to the share issue: - professional fees of 40,000 - internal management time in managing the process of 30,000 These costs are deductible in arriving at the entity's income tax liability. The current rate of tax is 30% In accordance with PAS32 financial instruments presentation, the increase in equity in the statement of financial position of Resty as a result of the transaction will be a) 311,000 b) 320,000 c) 360,000 d) 332,000
The Resty company issued 200,000 new P1 ordinary shares at a fair value of P1.80 each. Resty identified the following costs in relation to the share issue: - professional fees of 40,000 - internal management time in managing the process of 30,000 These costs are deductible in arriving at the entity's income tax liability. The current rate of tax is 30% In accordance with PAS32 financial instruments presentation, the increase in equity in the statement of financial position of Resty as a result of the transaction will be a) 311,000 b) 320,000 c) 360,000 d) 332,000
Chapter2: The Domestic And International Financial Marketplace
Section2.A: Taxes
Problem 2P
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The Resty company issued 200,000 new P1 ordinary shares at a fair value of P1.80 each. Resty identified the following costs in relation to the share issue:
- professional fees of 40,000
- internal management time in managing the process of 30,000
These costs are deductible in arriving at the entity's income tax liability. The current rate of tax is 30%
In accordance with PAS32 financial instruments presentation, the increase in equity in the
a) 311,000
b) 320,000
c) 360,000
d) 332,000
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