Problem A: The December 31, 2021 Statement of Financial Position accounts of A Company are shown below.

Prepare a
Company as of December 31, 2021 with appropriate notes to support line items presented in the face of the statement.

Account Title
Accounts Payable
Accounts Receivable
Accumulated Amortization - Patents
Accumulated Amortization - Trademark
Accumulated Depreciation - Building
Accumulated Depreciation - Equipment
Accumulated Profits
(also called "Unappropriated Retained Earnings")
Allowance for Bad Debts
Appropriated Retained Earnings
Bonds Payable (Due 2023)
Buildings
Cash and Cash Equivalents
Deferred Tax Liability
Discount on Bonds Payable
Equipment
Income Tax Payable
Inventory
Investment in Associate
Land (including land with an
undetermined future use acquired in
December 2021 for P 1,000,000)
Investment Property
Ordinary Share Capital - P 10 par
Share Premium - Preference
Share Premium - Ordinary
Patents
Preference Share Capital - P 100 par
Salaries Payable
Share Dividends Distributable
SSS Premium Payable
Trademarks
Financial Assets at Fair Value through
Profit or Loss
Withholding Taxes Payable
ounts of A Company are shown below. Prepare a properly classified statement of financial position for A
tems presented in the face of the statement.

Presentation Amount
Current Liability (CL) 236,000
Current Asset (CA) 115,000
Less Patent (NCA) 22,000
Less Trademark (NCA) 17,000
Less Building (NCA) 530,000
Less Equipment (NCA) 351,000
Equity (EQ) 262,000

Less Accounts Rec. (CA) 8,000

Equity (EQ) 45,000
Non-Current Liability (NCL) 800,000
Non-Current Asset (NCA) 1,440,000
Current Asset (CA) 86,250
Non-Current Liability (NCL) 50,000
Less Bonds Payable (NCL) 69,000
Non-Current Asset (NCA) 624,000
Current Liability (CL) 150,000
Current Asset (CA) 322,000
Non-Current Asset (NCA) 250,000

Non-Current Asset (NCA) 250,000

Non-Current Asset (NCA) 1,000,000

Equity (EQ) 1,300,000
Equity (EQ) 81,000
Equity (EQ) 240,000
Non-Current Asset (NCA) 120,000
Equity (EQ) 210,000
Current Liability (CL) 20,000
Equity (EQ) 24,000
Current Liability (CL) 21,250
Non-Current Asset (NCA) 60,000
Current Asset (CA) 61,000
Current Liability (CL) 30,000
 A Company
Statement of Financial
As of December 31

ASSETS: Note
Current Assets:
Cash and Cash Equivalents 86,250
Financial Assets at FVPL 61,000
Trade and Other Receivables 5 107,000
Inventory 322,000
Total Current Assets 576,250

Non-Current Assets:
Property, Plant, and Equipment 6 1,433,000
Intangible Assets 7 141,000
Investment Property 1,000,000
Investment in Associate 250,000
Total Non-Current Assets 2,824,000
TOTAL ASSETS 3,400,250

Notes to the Financial S

Note 1 - The Reporting Entity

Note 2 - Statement of Compliance (with IFRS)

Note 3 - Significant Accounting Policies

: inventory policy (FIFO)
: depreciation method (straight-line)
: cash equivalents policy

Note 4 - Other Disclosures

Note 5 - Trade and Other Receivables

Accounts Receivables 115,000.00
Less: Allowance for Bad Debts (8,000.00)
TOTAL 107,000.00

Note 6 - Property, Plant, and Equipment

Buildings 1,440,000.00
Less: Accumulated Depreciation - Bldg. (530,000.00) 910,000.00
 Equipment 624,000.00
Less: Accumulated Depreciation - Eqpt. (351,000.00) 273,000.00

Land 250,000.00
TOTAL 1,433,000.00

Note 7 - Intangible Assets

Patents 120,000.00
Less: Accumulated Amortization - P. (22,000.00) 98,000.00

Trademarks 60,000.00
Less: Accumulated Amortization - T. (17,000.00) 43,000.00
TOTAL 141,000.00

Note 8 - Trade and Other Payables

Accounts Payable 236,000.00
Salaries Payable 20,000.00
SSS Premium Payable 21,250.00
Withholding Taxes Payable 30,000.00
TOTAL 307,250.00

Note 9 - Financial Liabilities

Bonds Payables 800,000.00
Less: Discount on Bonds Payable (69,000.00)
TOTAL 731,000.00

Note 10 - Share Capital

Preference Shares 1,300,000.00
Ordinary Shares 210,000.00
Shares Dividends Distributable 24,000.00
TOTAL 1,534,000.00

Note 11 - Share Premium

Preference Shares 81,000.00
Ordinary Shares 240,000.00
TOTAL 321,000.00

Note 12 - Retained Earnings

Unappropriated Retained Earnings 262,000.00
Appropriated Retained Earnings 45,000.00
TOTAL 307,000.00
 A Company
Statement of Financial Position
As of December 31, 2021

LIABILITIES & EQUITY: Note

Current Liabilities:
Trade and Other Payables 8 307,250
Income Tax Payable 150,000
Total Current Liabilities 457,250

Non-Current Liabilities:
Financial Liabilities 9 731,000
Deferred Tax Liability 50,000
Total Non-Current Liabilities 781,000
TOTAL LIABILITIES

Shareholder's Equity:
Share Capital 10 1,534,000
Share Premium 11 321,000
Retained Earnings 12 307,000
TOTAL EQUITY

TOTAL LIABILITIES AND EQUITY

Notes to the Financial Statements

1,238,250

2,162,000

3,400,250
Problem B: Listed below and in random order, are the statement of financial position accounts and related balances of the
December 31, 2021 statement of financial position for the B Company, including the appropriate notes and parenthetical nota

Account Title Presentation Amount

Income Taxes Payable Current Liability (CL) 247,000
Prepaid Expenses Current Asset (CA) 31,000
Cash Surrender Value of Life Insurance Non-Current Asset (NCA) 89,000
Preference Share Capital Equity (EQ) 400,000
Premium on Bonds Payable Add Bonds Payable (NCL) 48,000
Cash and Cash Equivalents Current Asset (CA) 116,000
Property, Plant, and Equipment Non-Current Asset (NCA) 3,293,000
Accounts Payable Current Liability (CL) 580,000
Ordinary Share Capital Equity (EQ) 1,628,000
Retained Earnings Equity (EQ) 1,234,000
Land Held for Future Use Non-Current Asset (NCA) 195,000
Financial Assets through Profit or Loss Current Asset (CA) 160,000
Bonds Payable Non-Current Liability (NCL) 800,000
Share Premium - Ordinary Equity (EQ) 303,000
Inventories Current Asset (CA) 985,000
Accounts Receivable Current Asset (CA) 323,000
Patents Non-Current Asset (NCA) 182,000
Debt Investments at Amortized Cost (XYZ Non-Current Asset (NCA)
250,000
Bonds)
Share Premium - Preference Equity (EQ) 234,000
Unearned Revenues Current Liability (CL) 62,000
Provision for Product Warranty Current Liability (CL) 73,000
Allowance for Bad Debts Less Accounts Rec. (CA) 15,000
n accounts and related balances of the Ruby Corporation as of December 31, 2021. Prepare the
ppropriate notes and parenthetical notations.

Additional Information
a. The company uses control accounts for inventories and
property, plant, and equipment. The property, plant, and
equipment items are listed at their carrying values, based on the
cost model.

b. The straight-line method is used to depreciate buildings,

machinery, and equipment based upon their cost and estimated
residual values and lives. A breakdown of property, plant, and
equipment shows the following:

· Land at a cost of P 1,320,000;

· Buildings at a cost of P 1,824,000 and a carrying value of P
1,202,000;
· Machinery at a cost of P 639,000 and related accumulated
depreciation of P 186,000;
· Equipment (40% depreciated) at a cost of P 530,000;

· Included in the machinery is a unit costing P320,000 and with

accumulated depreciation of P80,000 included in the balance of
accumulated depreciation, that qualifies as held for sale. This
unit of asset has an estimated sales price of P 250,000; cost of
P40,000 is expected to be incurred on its sale. The sale is highly
probable and is expected to be consummated in May 2022.

c. Patents are amortized on a straight-line basis directly to the

patents account. The cost of the patent is P 200,000 while its
accumulated amortization is P 18,000.

d. Inventories are listed at the lower of cost and net realizable

value using an average cost. The inventories include raw
materials of P 222,000, goods in process of P 347,000, and
finished goods P 416,000.

e. The ordinary share capital has a P 10 par value per share,

200,000 are authorized, 162,800 shares have been issued.

f. Preference share capital has P 100 par value per share, 10,000
shares are authorized, 4,000 shares have been issued.

g. Financial assets through profit or loss are listed above at

market values; their aggregate cost is P 150,000.

h. The bonds payable mature on December 31, 2024.

i. The company attaches a one-year warranty on all products it
sells.
 Ruby Corpo
Statement of Finan
As of December

ASSETS: Note
Current Assets:
Cash and Cash Equivalents 116,000
Financial Assets at FVPL 5 160,000
Trade and Other Receivables 6 308,000
Inventories 7 985,000
Prepaid Expenses 31,000
Non-Current Asset Held for Sale 8 210,000
Total Current Assets 1,810,000

Non-Current Assets:
Property, Plant, and Equipment 9 3,248,000
Intangible Assets 10 182,000
Other Non-Current Financial Assets 11 339,000
Total Non-Current Assets 3,769,000
TOTAL ASSETS 5,579,000

Notes to the Financi

Note 1 - The Reporting Entity

Note 2 - Statement of Compliance (with IFRS)

Note 3 - Significant Accounting Policies

: inventory policy (FIFO)
: depreciation method (straight-line)
: cash equivalents policy

Note 4 - Other Disclosures

Note 5 - Financial Assets at Fair Value through Profit or Loss

The financial assets measured at fair value through profit or loss has an acquisition cost of P 150,000. The
fair value at December 31, 2021 is P 160,000.

Note 6 - Trade and Other Receivables

Accounts Receivables 323,000.00
Less: Allowance for Bad Debts (15,000.00)
TOTAL 308,000.00

Note 7 - Inventories
Raw Materials 222,000.00
Work-in-Process 347,000.00
 Finished Goods 416,000.00
TOTAL 985,000.00

Note 8 - Non-Current Asset Held for Sale

Machinery Cost 320,000.00
Less: Accumulated Depreciation (80,000.00) 240,000.00

Fair Value of Machinery 250,000.00

Less: Cost to Sell (40,000.00) 210,000.00 LOWER

Impairment Loss 30,000.00

(decreases the value of Retained
Earnings)

The machinery has a cost of P 320,000 and an accumulated depreciation of P 80,000, having a carrying
value of P 240,000. The fair value less cost to sell is P 210,000. The sale is highly probable and is expected
to be completed in May 2022.

Note 9 - Property, Plant, and Equipment

Buildings 1,824,000.00
Less: Accumulated Depreciation - Bldg. (622,000.00) 1,202,000.00

Equipment 530,000.00
Less: Accumulated Depreciation - Eqpt. (212,000.00) 318,000.00

Machinery 319,000.00
Less: Accumulated Depreciation - Mac. (106,000.00) 213,000.00

Land Held for Future Use 195,000.00

Land 1,320,000.00
TOTAL 3,248,000.00

Note 10 - Intangible Assets

Patents 200,000.00
Less: Accumulated Amortization - P. (18,000.00)
TOTAL 182,000.00

Note 11 - Other Non-Current Financial Assets

Cash Surrender Value of Life Insurance 89,000.00
Debt Investments at AC 250,000.00
TOTAL 339,000.00

Note 12 - Financial Liabilities

Bonds Payables 800,000.00
Add: Premium on Bonds Payable 48,000.00
TOTAL 848,000.00

Note 13 - Share Capital

Preference Share Capital, P 100 par, 10,000 share authorized,
4,000 shares issued and outstanding 400,000.00
 Ordinary Share Capital, P 10 par, 200,000 share authorized,
162,800 shares issued and outstanding 1,628,000.00
TOTAL 2,028,000.00

Note 14 - Share Premium

Preference Shares 234,000.00
Ordinary Shares 303,000.00
TOTAL 537,000.00
 Ruby Corporation
Statement of Financial Position
As of December 31, 2021

LIABILITIES & EQUITY: Note

Current Liabilities:
Trade and Other Payables 580,000
Income Taxes Payable 247,000
Unearned Revenues 62,000
Provision for Warranties 73,000
Total Current Liabilities 962,000

Non-Current Liabilities:
Financial Liabilities 12 848,000
Total Non-Current Liabilities 848,000
TOTAL LIABILITIES

Shareholders' Equity:
Share Capital 13 2,028,000
Share Premium 14 537,000
Retained Earnings 1,204,000
TOTAL EQUITY

TOTAL LIABILITIES AND EQUITY

Notes to the Financial Statements

1,810,000

3,769,000

5,579,000
Problem C: Presented below is the statement of financial position prepared by the bookkeeper of C Company on Decembe
financial position as of December 31, 2021. Use the items as suggested by IAS 1.

C Company
Statement of Financial Position
For the Year Ended December 31, 2021

Current Assets:
Inventory
Accounts Receivable
Cash
Treasury Shares (at cost)

Long-Term Investments:
Financial Assets at Fair Value through
Profit or Loss
Financial Assets at Fair Value through
Other Comprehensive Income

Property, Plant, and Equipment:

Land
Office Supplies
Buildings and Equipment

Intangible Assets:
Patents (net)
Prepaid Insurance
Deferred Tax Asset
Discount on Bonds Payable

TOTAL ASSETS

Current Liabilities:
Accounts Payable
Allowance for Uncollectible Accounts
Salaries Payable
Taxes Payable

Long-Term Liabilities:
Bonds Payable (due 2023)
Unearned Rent Revenue (due 3 mos.)

Equity:
Retained Earnings
Accumulated Depreciation on Building
and Equipment
Share Premium
Ordinary Share Capital, P 10 par
Accumulated Holding Gains (Losses) -
Investments at Fair Value through Other
Comprehensive Income
 Accumulated Holding Gains (Losses) -
Investments at Fair Value through Other
Comprehensive Income

TOTAL CREDITS
d by the bookkeeper of C Company on December 31, 2021. Prepare a properly classified statement of
AS 1.

C Company
Statement of Financial Position
r the Year Ended December 31, 2021

Current Asset (CA) 600,000

Current Asset (CA) 590,000
Current Asset (CA) 230,000
Equity (EQ) 330,000

Current Asset (CA) 320,000

Non-Current Asset (NCA) 1,030,000

Non-Current Asset (NCA) 810,000

Current Asset (CA) 80,000
Non-Current Asset (NCA) 3,560,000

Non-Current Asset (NCA) 470,000

Current Asset (CA) 50,000
Non-Current Asset (NCA) 70,000
Less Bonds Payable (NCL) 100,000

8,240,000

Current Liability (CL) 990,000

Less Accounts Receivable (CA) 80,000
Current Liability (CL) 150,000
Current Liability (CL) 250,000

Non-Current Liability (NCL) 1,100,000

Current Liability (CL) 90,000

Equity (EQ) 2,300,000

Less PPE (NCA) 920,000

Equity (EQ) 1,040,000

Equity (EQ) 1,200,000
OCI (EQ) 120,000
8,240,000
 C Company
Statement of Financial
As of December 31

ASSETS: Note
Current Assets:
Cash 230,000
Financial Assets at FVPL 320,000
Trade and Other Receivables 5 510,000
Inventory 600,000
Prepaid Expenses 6 130,000
Total Current Assets 1,790,000

Non-Current Assets:
Property, Plant, and Equipment 7 3,450,000
Intangible Assets 470,000
Financial Assets at FVOCI 1,030,000
Deferred Tax Asset 70,000
Total Non-Current Assets 5,020,000
TOTAL ASSETS 6,810,000

Notes to the Financial S

Note 1 - The Reporting Entity

Note 2 - Statement of Compliance (with IFRS)

Note 3 - Significant Accounting Policies

: inventory policy (FIFO)
: depreciation method (straight-line)
: cash equivalents policy

Note 4 - Other Disclosures

Note 5 - Trade and Other Receivables

Accounts Receivables 590,000.00
Less: Allowance for Bad Debts (80,000.00)
TOTAL 510,000.00

Note 6 - Prepaid Expenses

Office Supplies 80,000.00
Prepaid Insurance 50,000.00
 TOTAL 130,000.00

Note 7 - Property, Plant, and Equipment

Buildings and Equipment 3,560,000.00
Less: Accumulated Depreciation (920,000.00) 2,640,000.00

Land 810,000.00
TOTAL 3,450,000.00

Note 8 - Trade and Other Payables

Accounts Payable 990,000.00
Salaries Payable 150,000.00
Taxes Payable 250,000.00
TOTAL 1,390,000.00

Note 9 - Financial Liabilities

Bonds Payables 1,100,000.00
Less: Discount on Bonds Payable (100,000.00)
TOTAL 1,000,000.00
 C Company
Statement of Financial Position
As of December 31, 2021

LIABILITIES AND EQUITY: Note

Current Liabilities:
Trade and Other Payables 8 1,390,000
Unearned Rent Revenue 90,000
Total Current Liabilities 1,480,000

Non-Current Liabilities:
Financial Liabilities 9 1,000,000
Total Non-Current Liabilities 1,000,000
TOTAL LIABILITIES

Shareholders' Equity:
Share Capital 1,200,000
Share Premium 1,040,000
OCI - Accumulated Holdings Gains 120,000
Retained Earnings 2,300,000
Treasury Shares (330,000)
TOTAL EQUITY

TOTAL LIABILITIES AND EQUITY

Notes to the Financial Statements

2,480,000

4,330,000

6,810,000