17 Questions
What does the term 'highest bidder' refer to in the context of delinquent shares?
The bidder willing to receive the smallest number of shares
What is typically included in the offer price for delinquent shares in a public auction?
Unpaid balance due on subscription
Based on the information provided, what was the total cost incurred for auctioning Mr. Ronald's delinquent shares?
P20,000
How many shares did Twirlie express willingness to receive in the auction?
3,500
Which bidder is NOT mentioned as willing to pay the offer price for the delinquent shares?
Ronald
What is required for an individual to be considered the highest bidder in a public auction for delinquent shares?
Willingness to receive the largest number of shares
What is the total number of shares subscribed to in this case?
5,000
What are the journal entries made to record the expenses on the public auction?
Advances on share delinquency sale 20,000, Cash 20,000
Who is left with the remaining shares for the delinquent subscriber?
Ronald
How many shares did Champ bid for in this scenario?
3,000
In which account should the 'advances on share delinquency sale' be treated before payment from the highest bidder?
Current asset
What is the amount fully paid by 80% of the original subscribers for the share subscriptions?
P150,000
Why is the down payment multiplied by 80% in the computation?
Because only 80% of the original subscribers have fully paid their share subscriptions
What account is credited with the excess amount over par value when shares are issued at P120 per share?
Share premium
What happens if a share subscriber fails to pay their unpaid share subscription by the due date set by the board of directors?
They are declared a delinquent subscriber
What action may be taken with delinquent shares?
They may be sold at public auction to the highest bidder
Why do bidders participate in the public auction of delinquent shares?
To acquire shares at a potentially discounted price
Learn about the concept of the highest bidder in delinquent share subscriptions, including the components of the offer price. Explore a scenario involving Mcdollibee Corporation and Mr. Ronald's delinquent share subscription.
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