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0% found this document useful (0 votes)
320 viewsChapter 5 Robles Empleo Questions
2017 edition
Uploaded by
MichaelAndrewRamosCopyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF or read online on Scribd
/ 24
pape’
{Yell
Sethe following are items taken fom he records of |
Company for 201 .
se of P780,000, P1,520
a. Profit ater income tax expe sca
Richer purchase of and, 400,00
¢. Payment for retirement of bonds, P600,000
. _ Depreciation expense, P750,000
Seer tea euance of ordinary shares, P7O0,000
£ Gheorpromt of subsidiary, P80,000
& Patent amoriztin expense, P270.000
terest expense, Pl
P Intrease in accounts receivable, P340,000
ji Payment of dividends, P500,000
K._BeStease in accounts payable, P26,000
I fnerease in interest payable, P18,000
fh, Increase in income tax payable, P60,000
Required:
Prepare the operating activities section of Currency Company's 2
Stetement of Cash Flo's using the indirect method.
5-2. The following are various cash flows and other information of
Yen Company for 2017:
Payment of interest, P82,000
Proceeds from sale of land, P79,000
Payment of dividends, P121,000
Depreciation expense, P24,000
Collections from customers, P983,000
Payments of income taxes, P154,000
Proceeds from issuance of ordinary share capital,
189,000
Payments to suppliers and employees, P675,000
Increase in inventories, P46,000
Pr meno ee
Required:
Prepare the operating activities section mpany’s 201"
Statement of Cash Flows using the direct meno ‘3n0,009
430.000
» 90,000
120,099 290,009
220.000
6,000
154.000
Changes occurred in the company's
balties a
Cash Increase (Decrease)
Accounts Fecewable P 37.000
Inventories (0,000)
Accounts payable (trade)
Salaries payable
Income tax payable
Required
Prepare the operating actwmes section of the Peso Company's
Statement of Cash Flows for the year 2017 method
Sratems Cash ri wear 2017 using fa) indirect
‘The profit or loss section of the statement of comprehensive income
of Swiss Franc Company for the year ended December 31, 2017 is
Sales P6,100,000
Cost of goods sold 3.700,000
Gross profit 400,000
Gain on sale of equipment 100,000
Salaries expense 1820.00)
Insurance expense (380,000)
Depreciation expense 320,000
Profit before interest and income tax 1,080,000
Interest expense 120,900
Profit before income tax P 960.000
Income tax expense 708.000
Profit 872.000 pce
Decrease, Usiuries payable .
Increase in prepaid insurance .
Decrease im Not premium on bonds Pay’ ne
sen ee a <
ie aed aan as 5
Decrease ih deferred tax liabiit ne ne
oro :
ren :
san acti sci 8 SI Fah, :
pe re and :
ot and ated es ;
: Depreciation account: :
oexinning tance 490,88 achine § se /
hineC fachine oe
pegenngien $2.00, .
\ccumulated Depreciation
A Beginning balance 290,099
ed to Machine A 68,000 balance
Related to Mane B $e.000 | Depreciation expense 120,006
a ee eae
Required:
List all items with amount, that should be reported in a Statement of
Cash Flows based on the foregoing data. Assume that the compan,
uses indirect method of presenting cash flows from operating
activities.
5-6. The changes in account balances for 2017, taken from the
accounting records of Dollar Company, are presented overleaf:
Other information: Profit for the year was P579,950. Dividents
were declared and paid. Equipment was purchased for P1,880,000
No buildings and equipment were sold during the year. Ten
276 Berane crelneey shares were
Sth utente el ee 08 Ape
(4 for 95s
was 2,000" Income
1 beginning cash and
cash and cash equivatents
Accounts receivabie
tventory
Buildings and equipment je0,000
Accumulated depreciation cam
‘ecounts payable
Income tax payable -
Interest payable
Bonds payable, 89% due 5/1)
He 5/1/2021
rainy sar cn "po.
tained earnings
320,000
185,200
290,000
Required:
Prepare the 2017 Statement of Cash Flows for Dollar Company,
Following are the comparative statements of financial postion of
Riyal Company to aid in preparing a statement ofeach ees
Riyal Company
Comparative Statements of Financial Position
December 31, 2017 and 2016
2017
Assets
cash and cash equivalents igcrocoh eh renee
Financial assets at fair value
through profit or loss 400,000 poor
Accounts receivable 1,956,500 1,445,000
Inventory 3,050,000 3,200,000
[Long-term investments 1'000,000 1,250,000
Property, plant and equipment 9,000,000, 8,000,000,
Less accumulated depreciation. (2,200,000) (2,000,000)
Patents 600,000 600,000
Less accumulated amortization 1100,000)
Total assets 14,606,500 —P13,415,000
277 58
sapter 5 - The Statemenl Cash
Noy tel peer &
weuitct ns cpa
Ae
ceounes pavable oon,
Some tax veel one 40ne
1200 Boa ve 18504000 (S00.45°
112 Bonds Daron ponds Pa ee Poe
bese are capil rs9som
14,600,500
Retained earnings
phe following events to0k mice 2017:
$A long-term investment
Seneca costing P200,000 09/0 ‘accumulated depreciation,
Fas00 was sold for P#20,000- of
other information:
fe were issued on December 31, 201
rember 31 6 ang
The 6% bonds payabl
imerest is payable every De
Income tax rate is 30%.
Required:
prepare a statement of cash flows forthe year ended Decem
pote or Riyal Company using the indirect method of presenting 92!
cash
ows from operating activities.
she statement of Financial Position at Decemb
« \d the Income Statement (as part of Statement of Com and 2016
ree Breer 3207 hon mprehensie
Income) fr ea end maion “regarding. transactions fr 20h
follows
with original cost of 2,500,000 ang
a, Equipment
accumulated depreciation
soe jepreciation of P2,000,000 were sold for
Dividends declared and paid, P1,200,000.
Borrowed P6,000,000 cash on November 1, 2017 to be
3,000,
paid back with annual interest of 10% on June 1, 2018,
D
278 |AccoUnES Fecelvable
Prepaid rent
Inventories
Land
Buildings and equipment
Less: Accumulated dey
Investment in aasociaree S8OP
TOTAL ASSETS
bilities an
Recounts pas
Notes payable
Salaries payable
interest payable
Income tax payable
Total liabilities
Contributed capital
“Ordinary share capital
Share premium
Retained earnings
Total shareholders’ equity
TOTAL LIABILITIES & EQUITY
sales revenue
Cost of goods sold
Gross profit
Gain on sale of equipment
Operating expenses:
Depreciation expense
Salary expense
Rent expense
Miscellaneous expense
Profit before interest and income tax
Interest expense
Profit before income tax
Income tax expense
Profit
279
12017 ana Zole
P 1,652,200
1,020,00¢
1850,000
4,500,000
15,600,000
(5,650,000),
14,009,009
21,790,200
702,000
—_4168,500
Bis's70;500
21,790,200
Euro Company
Income Statement
For the Year Erided December 31, 2017
P 750,000
2,100,000
125,000
279,000,
2018
P 430,000
420,000
4,500,000
(6,900,000)
2,882,000
P 340,000
Fae0.000
P 2,500,000
3,202,000
3,300,000
9,002,000
9.462.000,
9,200,000
(3,200,000)
6,000,000
300,000
(3,245,000)
*P3,055,000
100,000
2,955,000
(886,500)
2,068,500 wos for the year ended Decomy
Required:
rhods of reporting cash fy,
iment of cash FID
emer indirect met
Prepare a Stal os
2017 using dit %
operating actvit
ved from analysis of 4.
December 31, 20)"
jon was obtain’ ley,
informati
infortca, for the year ended
5-9. The following
accounts of Rupiah Co:
Prenat srgeterm debt 5:000.005
Depreciation exPen 5 * "500,009
‘Amortization of intant 300‘000
Ie of equipment 00,00,
Proceeds from issue of ordinary share 4,500,099
Purchase of equipment 6,000,099,
Proceeds from sale of equipment 1,000, 00
Proceeds fom sale of and 1,800.0.
Brofit 5,950,009
Pre ein accounts receivable zoegm
Decrease in inventory 2,400,009
Increase in trade payables 4,200,009
sacra i income tax payable 11320.000
Deccnse n interest payable 7.0
Impairment loss on equipment 300,009
The balance of cash and cash equivalents at January 1, 2917
2,000,000. Income tax rate is 30%. “s
Required:
Compute the cash balance on December 31, 2017, oa Plowy ~?
‘The accountant for n;
° ane
10. Jfeash Mows an Company
5 “sdtonal nformaiggn t Mh flowing satement
B,
Statementcre
Denent of Cash Flows
cash inflows ber 31, 2017
Gain on bond etic a
Dividends reece men Me00
associates on investment in, 2
Issue ordinary shares 40,000
cash outtiows 80.900 790,000
etrement of ponds
at Of treastiry shares ac pices
Bisidends pad uirea 1.000
eaisition of property, plant and oS
Issue of bonds for real paren
Net cash decrease during Seuat” son ee
‘P4104,000)
Bigatti Os gent soy, og
incorporated into the statement, eis ee
‘The accountant made available the additional information:
Beginning cash balance 204,000
Depreciation 35,000
Amortization of premium on bonds 5,000
Gain on equipment sale 4,000
Stock dividends declared and distributed 20,000
Baht’s share of income from associates 65,000
15,000
Retained earnings appropriation
‘The following accounts changed by the amount indicated during
2017:
Accounts payable, P18,000; Revenue received in
Increases:
advance (current liability), P7,000; Accounts
receivable, P20,000
Decreases: Prepayments, P6,000; Inventory, P5,000
Required:
Prepare a corrected/revised statement of cash flows using indirect
method for operating activities.
281 chapter 5
\
MULTIPLE CHOICE QUESTIONS
MCF stat
nent of cash lows 18 :
int of financial position,
revenues earneq .
by
another na stement ehowing
in cimtstnses: incurred in earning the tev
oF 8S sate, lables, ang
ie Seports the cash infloy,
Met
4
business.
and the
result
1 report sho
ye on a speci
wrement_ thal
founting Peri
pose of the statement of ash flows
ot
Mca what is the primary Pun
about an entity's financial
a 2 1 Position
vy
tw provide information
pine in time
tor” provide
formance
Pa provide information th
Wee entity to generate ca
aCe pnovide information about an
paring a statement of cash OWS using the i
asks should be reported ao i
alee
fe amortization of trademé
about an entity's
fing
an,
‘a
information
Tor a period of time
mat is useful in assessing the
veh and cash equivalents, “iy
nntity’s financial struct,
Mc7
Mc3) When pret
method, th
low from investing activities.
cash inf
Cash outflow for investing activities.
citttion to profit to arrive at cash flows from ope
ati
MCB
activities,
deduction from profit to arrive at cash flows fro
activities. im OPeFatng
In a statement of cash flows using indirect method of prese
enti
cash flow from operating activities, depreciatic
: ; n is tr
adjustment to reported profit because depreciation _.o.
reduces the reported profit but does not involve an outtlow of
ci
Mca
MC’
cash.
b. reduces the reported i
“ profit and involves an
isan inflow of cash for asset replacement fund. —
usually represents a significant portion of operating
era
expenses, es
yc?
mcs
qv
®FEash Plow,
Which of the following
Milement of cate ming, *laosified as an operating activity im the
oo
equipment, and payments invoh
sips games ning pope, pant an
intrest en soto ts 3
« ‘advances and loans
Cash advances’ and loans made to other partie, other than
a. eeuieee and loans made bya financla ittaon
payments Hom onsets held for dealing
or trading purposes
Acquisition of an ass.
fication of an auuet either by aanuning dec related
b. Acquistion of anventity by means of an equity tue
es reasury shares for cash at more than par value
5 rnversion of debt to equity
w
hich of the following is presented as an operating activity?
a, Cash advances and I de by
loans made by finencial institutions
b. Cash proceeds from issuing shares or other equity
instruments
c. Cash repayments of amounts borrowed
@ Cash payments by a lessee for the reduction of the
outstanding liability relating to the firance lease
In preparing a statement of cash flows, which of the following
transactions would be considered an investing activity?
Sale of a business segment
Issuance of bonds payable at a disccunt
Purchase of treasury shares
Sale of share capital
Boge
‘ash flows, sale of treasury shares at an
In preparing a statement of c
Id be classified as a /an
amount greater than cost woul
transfer activity.
operating activity.
investing activity.
financing activity.
Boge
283 chapter = Thes
nose activities
tion or purchase and the
duction oF Pincluding expendi”
and co atucive set Ey
sets and Otreditors of the business or y,.,
short-term basis.
ments, cash Collectig,
ing cash oP &
interest pay!
ipt of cash dividends from ot}.
activities are #
Me10 Financing
wci4
‘
: ind financing activities.
ac
MC12 Investing activities are
transactions that involve making and collecting loans or thy
involve purchasing and selling plant assets and in
productive assets.
transactions with owners or long-term creditors of thy
MC
business or that involve borrowing cash on a short-term
basis. 7
© activities that involve the production or purchase gf
merchandise and the sale of goods and services ty
customers, including expenditures to administer th
business.
4. cash flows such as proceeds from issuance of bonds ani
cash outflows such as payments of principal amounts owed £—
A company acquire,
ast tired
13
ye’ butting,
NG 8 morgey!%E 8 Portion of the purchase
note payable
ae note to the eller for
ove traneaeehat amount fs tnehadea
B Acquis
a orga
a. Zero
welt ciara rages Payable decr,
eperating activiieg