Financial Accounting Qualifying Examinations PDF

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UNIVERSITY OF NUEVA CACERESCOLLEGE OF BUSINESS AND ACCOUNTANCYCity of NagaFINANCIAL ACCOUNTING AND REPORTING 1 AND 3 The relevant accounts and adjusted balances shown below were taken from Gradual Company’s trial balance on December 31, 2016: Cash deposit in banks P 300,000. God bullion deposited in...

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UNI VERSI TYOFNUEVA CACERES COLLEGEOFBUSI NESSAND ACCOUNTANCY Ci t yofNaga FI NANCI ALACCOUNTI NG AND REPORTI NG 1AND 3 1. Ther el evantaccount sandadj us t edbal anc esshown be l ow wer et aken f r om Gr adualCompany’ st r i al bal anc eonDecember31,2016: Cashdeposi ti nbanks P 300, 000. 00 Godbul l i ondeposi t edi nbanks 2, 000, 000. 00 Tr adeac count sr ecei vabl e 1, 400, 000. 00 I nve st menti nde bti nst r ument s 3, 000, 000. 00 I nve st menti nequi t yi ns t r ument s 1, 600, 000. 00 400, 000. 00 I nve st ment i n e qui t y i ns t r ument s wi t h s i gni ficant 2, i nfluenc e Pr epai de xpense s 120, 000. 00 Fi nanc el easepayabl e 250, 000. 00 De f er r edr ev enue 120, 000. 00 Tr adepayabl e 650, 000. 00 Pr ovi s i onf ore s t i mat edl i t i gat i onl oss 420, 000. 00 I ssuedde bti ns t r ument 1, 800, 000. 00 I ssuede qui t yi nst r ument s 2, 900, 000. 00 Whatt ot alamountoffinanc i ali ns t r ument s–asse t st hatar ewi t hi nt hescopeofI AS 32andI FRS 39 shoul dGr adualCompanyr epor tf ort hey ear2016? a. 4, 900, 000. 00 c . 6, 420, 000. 00 d. 8, 700, 000. 00 b. 6, 300, 000. 00 2. Usi ngt hesamei nf or mat i on i nnumbe r1,whatt ot alamountoffinanci ali ns t r ument s–l i abi l i t i est hat ar ewi t hi nt hescopeofI AS32andI FRS39s houl dGr adualr epor tf ort hey ear2016? a. 650, 000. 00 c. 2, 450, 000. 00 b. 1, 800, 000. 00 d. 1, 870, 000. 00 Quest i ons3t o6ar ebasedont hef ol l owi ngi nf or mat i on: Smar tc ompanyhast hef ol l owi ngfinanc i alasse t sasofDec ember31,2016:     

 

APhp300, 000. 00accountr ecei v abl et hati snothe l df ort r adi ng . An Php 800, 000. 00 i nves t menti n an equi t yi ns t r umentquot edi n an ac t i v emar ke tt hati snot he l df ort r adi ng. A Php500, 000. 00i nv e st menti nan equi t yi ns t r umentt hati snothel df ort r adi nganddoe snot haveaquot edpr i c eandwhosef ai rv al uec annotber e l i abl ymeasur ed. A Php 600, 000. 00 pur c has ed de btsec ur i t y wi t ht heobj ect i v et o hol dt heasse tt o col l e ctt he c ont r ac t ualcashflowst hatar esol e l ypaymentofi nt er estandpr i nc i pal . A Php 700, 000. 00 pur c hased de btsecur i t y quot ed i n an ac t i vemar ke tt hatSmar tCompany pl anst ohol dt omat ur i t y . Smar tCompanyhasabus i nessmode lwi t ht heobj ect i veoft r adi ng t hes ec ur i t yt omakepr ofitf orc hangesi nt hef ai rv al ueofde btsecur i t i es. A Php400, 000. 00i nve st menti n equi t yi ns t r ument st hati squot edi n anact i v emar ke t . Smar t Companyhasnoi nt ent i ont osel lt hei nve st ment . APhp600, 000. 00i nv es t menti nequi t yt hati shel df ort r adi ng.

3. Whatamountoffinanci alass et s–measur edatamor t i z edc ost ? a. 300, 000. 00 b. 600, 000. 00

c . 700, 000. 00 d. 900, 000. 00 4. Whatamountoffinanci alassetunde rt hecat egor y–i nves t menti n equi t yt opr ofitorl ossshoul d be separ at e l yr epor t edi nt heDec ember31,2016st at ementoffinanci alposi t i on? a. 300, 000. 00 c . 700, 000. 00 d. 900, 000. 00 b. 600, 000. 00 5. Whatamountoffinanci alasse tundert hecat egor y–i nves t menti ne qui t yt hr oughot he rc ompr ehe nsi v e i nc omeshoul dbesepar at e l yr epor t edi nt heDecember31,2016s t at ementoffinanci alposi t i on? a. 1, 200, 000. 00 c. 1, 700, 000. 00 b. 1, 300, 000. 00 d. 2, 400, 000. 00 6. Whatamountoffinanci alasse tundert hecat egor y–i nves t menti ndebts ecur i t yatf ai rv al ues houl dbe separ at e l yr epor t edi nt heDec ember31,2016st at ementoffinanci alposi t i on? a. 600, 000. 00 c . 1, 300, 000. 00 d. 2, 000, 000. 00 b. 700, 000. 00 7. X Company ,apar entcompanyhasr epor t e dt hef ol l owi ngcur r entaccounti ni t sfinanci alr ecor dsasof Dec ember31,2016: Cashandcashe qui v al ent s Loansar er ecei vabl es Mer chandi s ei nv ent or y Pr epai de xpense Tot al

P 3, 000, 000. 00 20, 000, 000. 00 2, 000, 000. 00 500, 000. 00 P25, 500, 000. 00

I nc l ude di nt hel oansand r ecei v abl e si sa Php 5, 000, 000. 00 l oan t o M Company ,a subs i di ar y . The l oan i sr epayabl eon de mandbutt hedemandf eat ur ei spr i mar i l yaf or m ofpr ot ec t i on orat axdr i ven f eat ur eoft hel oan and i ti st hei nt ent i on ofbot h par t i es t hatt hel oan wi l lr emai n out s t andi ng f or f or eseeabl ef ut ur e . Whati st he cor r ectamountofcur r entasse t s shoul d X Company r epor ti ni t s Dec ember31,2016financi alposi t i on? c . 25, 000, 000 a. 20, 500, 000 b. 23, 500, 000 d. 25, 500, 000 8. Theac count sandbal ancesshown be l ow wer et ake nf r om Basi cCompany’ st r i albal anc eon Decembe r 31,2016.Al ladj us t i nge nt r i eshavebeenmade: Wagespayabl e,Php250, 000;Cash,Php175, 000;Bondspayabl e,Php600, 000;Di vi dendspayabl e,Php 140, 000;Pr epai d Rent ,Php 136, 000;I nv ent or y ,Php 820, 000;I nv es t menti n Si nki ng Fund,Php 525, 000;I nv e st mentt o pr ofitand l oss secur i t i es,Php 153, 000;Pr emi um on bonds payabl e,Php 48, 000;I nves t menti n subs i di ar y ,Php 1, 020, 000;Taxespayabl e,Php 228, 000. 00;Acc ount spayabl e, Php 248, 000;Acc ount sr ecei vabl e,Php 366, 000;Pr oper t y ,pl antand equi pment ,Php 1,200, 000; Pat ent s – ne t ,Php 150, 000;Acc umul at ed depr eci at i on – PPE,Php 400, 000;Land hel df or f ut ur e bus i nesssi t e,Php900, 000. How muchshoul dber epor t edi nBasi c’ sDecember31,2016s t at ementoffinanci alposi t i onasc ur r ent andnoncur r entasse t s,r es pec t i v e l y? a. 1, 650, 000and2, 375, 000 c . 1, 800, 000and2, 225, 000 d. 1, 800, 000and3, 795, 000 b. 1, 650, 000and3, 395, 000 9. Usi ngt hesamei nf or mat i oni nnumber8,how muchs houl dber epor t edi nBasi c’ sDecembe r31,2016 s t at ementoffinanc i alposi t i onasc ur r entandnonc ur r entl i abi l i t i e s ? a. 776, 000and552, 000 c . 916, 000and640, 000 d. 916, 000and648, 000 b. 866, 000and648, 000

10.Hal oI ncr epor t edt hef ol l owi ngi t emsi ni t sDec ember31,2016t r i albal anc e: Ac countpayabl e P1, 089, 000 Advanc est oe mpl oyees 45, 000 Une ar ne dr entr ev enue 288, 000 Est i mat edl i abi l i t yunderwar r ant i es 258, 000 Cashsur r enderv al ueofofficer ’ sl i f ei nsur ance 75, 000 Bondspayabl e 5, 000, 000 Di scountonbondspayabl e 225, 000 Tr ade mar k 390, 000 How muc h shoul d Hal or epor tas t ot all i abi l i t i e si ni t s December31,2016 s t at ementoffinanci al posi t i on? c . 6, 845, 000 a. 6, 410, 000 b. 6, 800, 000 d. 7, 410, 000 11.Pi l otCompanyhadt hef ol l owi ngi t emsatDecembe r31,2016: Ac countpayabl e Uns ec ur ednot es ,9%,dueJul y1,2017 Ac cr uedexpenses Pr ovi s i onf orl i t i gat i on De f er r edi ncomet axl i abi l i t y Bondspayabl e,5%,dueMar ch31,2017

P 330, 000 800, 000 210, 000 2, 700, 000 150, 000 6, 000, 000

Thec ont i ngentl i abi l i t yi san ac cr ualf orpr obabl el osse son aPhp 6, 000, 000. 00 l awsui tfil e d agai ns t Pi l otCompany . Pi l ot ’ sl egalc ouns e lexpec t st hesui tt obes et t l edi n2016.Thecounse lhases t i mat ed t hatPi l otwi l lbel i abl ef ordamagesi nt heamountofPhp2, 700, 000. 00. Thede f e r r ed i nc omet axl i abi l i t yi snotr e l at ed t o an asse tf orfinanci alr epor t i ngand i sexpec t ed t o r ev er sei n2016. Whati st heamountofc ur r entl i abi l i t i est hatPi l ots houl dr epor ti ni t sDecembe r31,2016s t at ementof financ i alposi t i on? a. 6, 690, 000 c . 9, 390, 000 d. 11, 960, 000 b. 7, 340, 000 12.AsofDecember31,2016,t hecur r entl i abi l i t i esofMaz eCompanyt ot al ed Php 1, 500, 000 be f or eany y ear endadj us t mentr e l at i ngt ot hef ol l owi ng: On December19,2016,asuppl i eraut hor i z edMaz eCompanyt or e t ur n,f orf ul lcr edi t ,goodsshi ppe d andbi l l edatPhp45, 000on Decembe r9,2016. Ther e t ur ne dcr edi tmemowasr ecei vedandr ec or de d byMaz eCor por at i ononJanuar y2,2017. Dur i ng December 2016,Maz er ecei ved Php 75, 000 f r om a c ust omer as an advance paymentf or mer c handi sewhi c h Maz ewi l lmakeac cor di ngt ot hecus t omer s ’s peci ficat i ons. Fort hi st r ansac t i on, Maz ehasaPhp75, 000cr edi tbal anc ei ni t sac count sr ecei vabl ef r om t hesai dc ust omeronDec ember 31,2016. Om Decembe r28,2016,t hecompanywr ot eandr ecor dedc hec kst ocr edi t or st ot al i ngPhp400, 000. 00 whi c h woul d causean ov er dr af tofPhp 100, 000. 00 i nt hecompany’ sbank ac counton December31, 2016.Thec he ckswer emai l e donJanuar y9,2017.

Whatamountshoul d Maz e Company r epor tas t ot alc ur r entl i abi l i t i es i ni t s December31,2017 s t at ementoffinanc i alposi t i on? a. 1, 555, 000 c . 1, 855, 000 b. 1, 630, 000 d. 1, 930, 000 13.Br i deCompanybe ganoper at i onsonJanuar y1,2016wi t hPhp1, 000, 000f r om t hei ssuanc eofs har e s and bor r owed f undsofPhp 450, 000. Ne ti ncomef or2016 wasPhp 300, 000 and Br i depai d a Php 225, 000 cas h di vi dendon Decembe r19,2016. Noaddi t i onalt r ans ac t i onsaffec t ed owner s ’equi t yi n 2016. AtDecember31,2016,l i abi l i t i esoft hecompanyhadi nc r easedt oPhp597, 000. 00. I n Br i de’ s Dec ember31,2016st at ementoffinanci alposi t i on,how muchshoul dber epor t edasi t st ot alasse t s ? a. 1, 525, 000 c . 1, 750, 000 d. 1, 760, 000 b. 1, 672, 000 14.Par t y Company r epor t ed t ot alasse t s ofPhp 1, 050, 000 and t ot all i abi l i t i e s ofPhp 680, 000 i ni t s Dec ember31,2016st at ementoffinanci alposi t i on.Thef ol l owi ngt r ans ac t i onsoc cur r eddur i ng2017:  OnAugus t1,Par t yCompanyi s suedanaddi t i onal5, 000or di nar ys har esatPhp25pe rs har e .  Thec ompanypai ddi vi dendst ot al i ngPhp80, 000.  Ne ti ncomedur i ngt hey earwasPhp110, 000.  Reacqui r edt r easur ys har esof2, 000atPhp30;s ubs equent l y ,r ei ssued1, 000f orPhp39pe rs har e .  Noot herc har ge socc ur r edi nShar e hol der s’Equi t ydur i ngt hey ear . Whati st hebal anc eoft heshar ehol der s ’e qui t ysect i oni ni t sDecember31,2017s t at e mentoffinanci al posi t i on? a. 400, 000 c . 525, 000 d. 685, 000 b. 504, 000 15.Fort hey earendedDecember31,2016,Tr ans f or mer s,I nc .r epor t edt hef ol l owi ng: Ne ti ncome P600, 000 Pr ef er enc es har escapi t aldi vi dendsde cl ar ed 100, 000 Or di nar ys har e scapi t aldi vi dendsde cl ar ed 20, 000 Unr eal i z edhol di ngl oss,ne toft ax 10, 000 Re t ai ne de ar ni ngs ,begi nni ng 800, 000 Or di nar ys har ec api t al 400, 000 Ac cumul at edot he rc ompr e hens i vei ncome,beg 50, 000 Whatwoul dbet hee ndi ngbal anc eofr et ai nede ar ni ngs ? a. 1, 390, 000 b. 1, 330, 000

c. 1, 280, 000 d. 1, 270, 000

16. Usi ngt hesamei nf or mat i on i n number15,whatamountshoul d ber epor t ed ast ot alshar ehol der s ’ equi t y? a. 1, 870, 000 c. 1, 970, 000 b. 1, 890, 000 d. 1, 990, 000 17.Gr eenCompanyhad60, 000shar esofPhp100par ,5% c umul at i vepr ef er enceshar esout st andi ngasat Dec ember31,2016. The r ewer enodi vi dendsi n ar r ear sasofDecember31,2014. Thecompanydi d notdec l ar edi vi dendsdur i ng2015. Dur i ng2016,Gr een pai d cash di vi dendsofPhp 200, 000 on i t s pr ef er enc e shar e s. How much shoul d Gr een pr esentt hedi vi dends i n ar r ear si ni t s 2016 financi al s t at ement s ? a. Ac cr uedl i abi l i t yofPhp300, 000. c . Ac cr uedl i abi l i t yofPhp400, 000. b. Di sc l osur eofPhp300, 000. d. Di scl os ur eofPhp400, 000.

18. The dr af toffinanci als t at ement s ofCl ar i on Company ,f ort he yearende d Decembe r 31,2016 i s c ur r ent l yundercons i der at i onbyt hedi r ec t or s . Thene tasse tf ort heyeari sshownasPhp3, 500, 000. Si nceDecember31,2016t hef ol l owi ngev ent shaveoccur r ed,buthavenotbe enr eflec t edi nanywayi n t hedr af tfinanci als t at ement st ot hatdat e. I t em 1–Asubs t ant i alquant i t yofsl ow movi ngi nvent or ywassol df orPhp320, 000.Thei nv ent or yhad ac os tofPhp600, 000andhadbe enval uedf ort heac count satDecember31,2016ati t sest i mat edne t r eal i z abl ev al ueofPhp400, 000. I t em 2–At r ader ecei v abl epai dt heamountowi ngofPhp130, 000i nf ul l .AtDec ember31,2016t her e wer edoubt sast owhe t he ri twoul dbepai d,andas peci ficpr ovi s i onf ort hef ul lamounthadbe enmade i nt heaccount s. Whati st headj us t edamountofne tasse t sshoul dCl ar i onr epor ti ni t sDec ember31,2016st at ementof financ i alposi t i on? a. 3, 420, 000 c. 3, 550, 000 b. 3, 500, 000 d. 3, 630, 000 19.Mer i tCor por at i on hasanar r ang ementwi t hi t sc us t omer st hat ,i n any12mont hper i ode ndi ngMar c h 31,i ft he y pur c hase goods f ora val ue ofatl eastPhp 2, 000, 000,t he y wi l lr ecei v ea r et r ospe ct i v e di sc ountof2%.Att heendoft hey earendedDecember31,2016,Mer i tCor por at i onhasmadesal est o a cus t omerdur i ng t he per i od Apr i l1 t o December31,2016 ofPhp 1, 800, 000. Whatamountof r ev enueshoul d Mer i tr epor ti ni t sDec ember31,2016 pr ofitorl osss t at ementr el at ed t ot he abov e ar r angement ? a. 1, 323, 000 c . 1, 800, 000 d. 1, 960, 000 b. 1, 764, 000 20.Lov esMar ke t i ngCor por at i ons el l smer c handi sewi t hac os tofPhp300, 000t oI nt elCor por at i onf orPhp 420, 000andacr edi tpe r i od ofsi xmont hs . Love snor malse l l i ngpr i cewoul dhavebeen Php 375, 000 wi t h a cr edi tper i od ofone mont h and wi t h a di scountofPhp 15, 000 f orcash on de l i ver y . What amountofr evenuef r om sal ess houl dLovesr ecogni z e ? c . 405, 000 a. 360, 000 b. 375, 000 d. 420, 000 21.Thef ol l owi ng sal est r ans ac t i onswer emadebyOxf or d Companyatt hec l os e oft heac count i ngyear Oc t ober31,2016. Oxf or d sel l s goods t o Apr on Company .I nt hesal es cont r ac t ,t her ei s a cl ause t hatOxf or d hasan obl i gat i on f orunsat i sf ac t or yper f or manc e,whi ch i snotgov er nedbynor malwar r ant ypr ovi si ons . The c os toft heg oodss ol dwasPhp200, 000andwer ebi l l edatPhp275, 000. Oxf or dshi ppedani t em ofi nv ent or ycos t i ngPhp400, 000f orPhp480, 000t oades t i nat i onspe ci fiedby t hebuy er . A si gni fic antpar toft het r ans act i on i nv ol vesi ns t al l at i on t hathasnotyetbeen f ul fil l edby Oxf or d. Oxf or dsol dani t em ofi nv ent or yf orPhp120, 000butt hebuyerhast her i ghtt ocanc e lt hepur chasef or ar eason notspeci fiedi nt hecont r ac tofsal e( dul ysi gne dbybot hpar t i es)andt heOxf or di sunc er t ai n aboutt hei ncome.

Whatamountofr evenuef r om sal es houl dOxf or dr ecogni z easi nc omeofOc t ober31,2016? c . 275, 000 a. None b. 120, 000 d. 480, 000

22.OnDecember31,2016,Tr i dentCompanyhass t ar t edi t sope r at i onr e t ai ls t or ef ore l ect r oni cpr oduc t .I t i sat t r ac t i ngcust omerbasebyal l owi ngt hecus t omert ohav et hefir stpr oductf r ee . Thecus t omeri s under no obl i gat i on t ot ake f ur t her pr oduc t s. As ofDecembe r 31,2016,Tr i dentCompany has di s t r i but ed2, 000e l e c t r oni cpar t sf orf r eeandt he separ t swer epur chasedf orPhp25eac h. Al soasof Dec ember31,2016,t hecompanyhassol d200, 000par t sf orPhp80eac h.How s houl dt he2, 000par t s di s t r i but edasshowni nt heDecember31,2016pr ofitorl ossofTr i dentCompany? a. Asmar ket i ngcostofPhp50, 000 b. Asc os tofs al esofPhp50, 000 c . De f er r edc os tofPhp50, 000 d. Onl yadi scl osur ei sr equi r edi nt henot est ofinanci als t at ement s 23.Di e se lf ue lhe l dasi nvent or yat1Nov ember2016wasPhp125, 000andt he r ewer ei nvoi cesawai t edf or Php17, 000. Dur i ngt heyeart o31Oct ober2017,di ese lf ue li nvoi cesofPhp854, 000wer epai d,and de l i ver ywor t hPhp13, 000hady e tt oi nvoi ced.At31Oc t obe r2017,di e self ue li nv ent or ywasv al uedat Php98, 000.Thedi ese lf ue lt obechar gedasexpens ei nt hepr ofitorl os soft heyear31Oc t obe r2017 i s a. 851, 000 c . 885, 000 d. 911, 000 b. 877, 000 24.Cour tCompanyr epor t edt hef ol l owi ngi nf or mat i onf or2016: Sal esr ev enue Cos tofgoodss ol d Ope r at i nge xpens es Unr eal i z edhol di ngg ai nonequi t ysecur i t i es Cashdi vi dendsr ecei vedont hesecur i t i e s

P500, 000 350, 000 55, 000 20, 000 2, 000

For2016,Cour twoul dr epor tc ompr e hens i v ei nc omebe f or et axof c . 97, 000 a. 117, 000 b. 115, 000 d. 20, 000 25.Fort heyeare nde dDecembe r31,2016,Tr afficI nc .r epor t edt hef ol l owi ng: Ne ti ncome P180, 000 Pr ef er enc es har edi vi dendde cl ar ed 30, 000 Or di nar ys har edi vi denddecl ar ed 6, 000 Unr eal i z edhol di ngl oss,ne toft ax 3, 000 Re t ai ne de ar ni ngs 240, 000 Or di nar ys har ec api t al 120, 000 Ac cumul at ed ot hercompr e hens i vei ncome,be g,ne tof 15, 000 t ax Whatwoul dTr afficr epor tasi t se ndi ngbal anc eofAccumul at edOt herCompr ehe ns i v eI ncome ? a. 18, 000 c. 12, 000 b. 15, 000 d. 3, 000 26. Happy Company keeps l i mi t ed r ecor d. I t s as se t s and l i abi l i t i e s att he be gi nni ng and end oft he c ur r enty earar easf ol l ows: Be gi nni ng Endi ng

Cashi nbank Ac count sr ecei vabl e ,ne t Mer chandi s ei nv ent or y Ac count spayabl e Not espayabl e–bank Equi pment–ne t

P 30, 000 50, 000 100, 000 40, 000 20, 000 80, 000

P 50, 000 70, 000 80, 000 20, 000 25, 000 60, 000

Dur i ng t heyear ,t heowne rwi t hdr ew cash ofPhp 120, 000 and madeaddi t i onali nve st mentofPhp 50, 000.How muchi st heneti nc ome/l ossf ort hey ear ? a. 35, 000 c . 120, 000 d. 135, 000 b. 85, 000 27.Jungl eCompany’ saccountbal anc esdur i ng2016showedt hef ol l owi ngc hang es,al li ncr ease: Asse t s 3, 560, 000 Li abi l i t i es 1, 080, 000 Or di nar ys har ec api t al 2, 400, 000 Pr emi um 240, 000 The r ewer enoc hangesi naccumul at edpr ofit sf or2016ot he rt hanPhp520, 000di vi dendpaymentand y ear s ’ear ni ngs .How muchi st hecompany’ sneti nc ome/l ossf or2016? a. 160, 000 c . 520, 000 d. 680, 000 b. 360, 000 28.Thefinanci alr ecor dsofFoodI nc .wer ede s t r oyedbyfir eatt heendof2016.For t unat e l y ,t hec ont r ol l er hadkeptc er t ai ns t at i s t i caldat ar el at edt ot hei nc omes t at ementaspr esent edbe l ow:  Thebe gi nni ngmer chandi sei nv ent or ywasPhp92, 000anddecr easedby20% dur i ngt hey ear .  Sal esdi scount samountofPhp17, 000.  20, 000or di nar ys har eswer eout st andi ngf ort hee nt i r ey ear .  I nt er es te xpensewasPhp20, 000.  Thei nc omet axr at ei s35%.  Cos tofgoodss ol damount st oPhp500, 000.  Admi ni s t r at i vee xpens esar e20% ofc os tofgoodssol dbutonl y8% ofgr osss al es.  Fourfif t hsoft heoper at i ngexpensesr e l at et os al esac t i vi t i e s . How muchi st henetpr ofiti nt hey ear2016? a. 113, 000 b. 132, 400

c. 138, 450 d. 213, 000

29. Vi deoCompanybegan busi ne ssoper at i on i n 2011. An exami nat i on oft hecompany’ sal l owanc ef or baddebt sac countr ev eal st hef ol l owi ng: Est i mat edBadDe bt s Ac t ualBadDebt s 2011 P44, 000 P27, 000 2012 P52, 000 P40, 800 2013 P66, 000 P53, 700 2014 Noadj us t menty et P57, 000 I nt hepas t ,t hec ompanye s t i mat edt hat3% oft hecr edi tsal eswi l lbeunc ol l e ct i bl e. Thecompanyhas de t er mi nedt hatt heper c ent ageus edi ne s t i mat i ngbadde bt shasbeeni nappr opr i at e;t hene w est i mat e r ev eal edt hatbaddebt sshoul dbe1. 5% ofsal e s . Whati st hene tamountofadj us t mentt ot hebegi nni ngbal anc eoft heac cumul at edpr ofit sonJanuar y 1,2014asar esul toft hec hangei naccount i nge s t i mat e ? a. None b. 12, 300

c . 40, 500

d. 42, 000

30.Mango Company boughta mac hi ne on Januar y 1,2011 f orPhp 240, 000 atwhi c ht i me i thad an e st i mat edus e f ull i f eofei ghty ear s,wi t hnor esi dualval ue .St r ai ghtl i nemet hodofde pr eci at i oni ssued f oral lofMango’ sdepr eci abl easset s. On Januar y 1,2013,t hemac hi ne ’ se st i mat e d use f ull i f ewas de t er mi nedt obeonl y6y ear sf r om t heac qui si t i ondat e .I n Mang o’ s2013s t at ementofc ompr ehe nsi v e i nc ome,whatamountofdepr eci at i on shoul dt hecompany r ecogni z ed as a r esul toft he change i n e st i mat e ? a. None c . 40, 000 b. 30, 000 d. 45, 000 31. Dur i ng 2014,Tr i c ky Company deci ded t oc hange f r om FI FO me t hod ofi nvent or yv al uat i on t ot he wei ght edaver ageme t hod.I nv ent or ybal anc esundere ac hme t hodwer easf ol l ows: FI FO We i ght edAv er ag e Januar y1 1, 420, 000 1, 540, 000 Dec ember31 1, 580, 000 1, 660, 000 I nc omet axr at ei s35%. I ni t syear2014st at ementofr et ai nedear ni ngs,whatamountshoul dTr i c ky r epor tast hee ffec toft heaccount i ngc hange ? a...