The equity of P Limited at 1 January 2019 was $668000.
Profit for the year ended 31 December 2019 was $120000.
During the year ended 31 December 2019, the following also took place:
1 April Paid an interim dividend of $40000
1 July Transferred $50000 from retained earnings to general reserve
1 October Issued 5% debentures for $200000
31 December Proposed a final dividend of $30000
What was the total equity of P Limited at 31 December 2019?

Q: What topic does this question test?

This question tests Companies in A-Level Accounting (syllabus code 9706). It is worth 1 mark.

Q: Which exam paper is this question from?

This question appeared in the Cambridge A-Level Accounting Feb/Mar 2020 examination, Paper 1 Variant 2 (9706_m20_qp_12.pdf).

Question

The equity of P Limited at 1 January 2019 was $668000.
Profit for the year ended 31 December 2019 was $120000.
During the year ended 31 December 2019, the following also took place:
1 April	Paid an interim dividend of $40000
1 July	Transferred $50000 from retained earnings to general reserve
1 October	Issued 5% debentures for $200000
31 December	Proposed a final dividend of $30000
What was the total equity of P Limited at 31 December 2019?

Oracle Prep · Accepted Answer

The correct answer is C: $748000.

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