Accounting 6
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Transcript of Accounting 6
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8/11/2019 Accounting 6
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ATENEO DE DAVAO UNIVERSITYSCHOOL OF BUSINESS & GOVERNANCE
ACCOUNTANCY DEPARTMENT
ACC 6 Financial Accounin! & R"#o$in! III %PS Macuo'CPA() S"*")"$' AY +,(-.+,(/P$"li* 0ui1 (
G"n"$al In)$ucion)2
1.) T3" ") i) !oo4 5o$ a *ai*u* o5 7, *inu") onl8 No on" i) allo9"4 o !o ou o5 3" $oo* 93il" i
i) !oin! on2.) Plac" 8ou$ an)9"$) in a cl"an )3"" o5 #a#"$ Do no 9$i" a 3" :ac; o5 8ou$ an)9"$ )3"" Uili1"
ano3"$ )3"" o5 #a#"$ i5 on"
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ATENEO DE DAVAO UNIVERSITYSCHOOL OF BUSINESS & GOVERNANCE
ACCOUNTANCY DEPARTMENT
ACC 6 Financial Accounin! & R"#o$in! III %PS Macuo'CPA() S"*")"$' AY +,(-.+,(/P$"li* 0ui1 (
-= No :o$$o9in! o5 an83in!/= MYOB C3"ain! i) )$icl8 #$o3i:i"4 an4 9ill :" 4"al 9i3 acco$4in!l86= Failu$" o 5ollo9 3" a:o" in)$ucion) 9ill $")ul o a ( 4"4ucion 5$o* 8ou$ $ain! on 3i) @ui1
7.) Go4 :l"))= Sa$
PROBLEMS Provide what is required.
(= The income statement of Augustus Waters Corporation for 2014 included the following items!nterest "evenue P#$%$00&alaries '(pense )$%000
!nsurance '(pense 12%*00The following +alances have +een e(cerpted from August Waters Corporation,s +alance sheets
12-1-2014 12-1-201Accrued interest receiva+le P#%100 P)%$00
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ATENEO DE DAVAO UNIVERSITYSCHOOL OF BUSINESS & GOVERNANCE
ACCOUNTANCY DEPARTMENT
ACC 6 Financial Accounin! & R"#o$in! III %PS Macuo'CPA() S"*")"$' AY +,(-.+,(/P$"li* 0ui1 (
Accrued salaries pa/a+le %#00 4%200Prepaid insurance 1%100 1%$00
RE0UIRED
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ATENEO DE DAVAO UNIVERSITYSCHOOL OF BUSINESS & GOVERNANCE
ACCOUNTANCY DEPARTMENT
ACC 6 Financial Accounin! & R"#o$in! III %PS Macuo'CPA() S"*")"$' AY +,(-.+,(/P$"li* 0ui1 (
RE0UIRED = 6an 3alen Compan/% a sole proprietorship% recorded transactions on the cash +asis during 2014. Theentit/ provided the following information
Cash 2*0%000Accounts receiva+le% 1-1-14 1*0%000!nventor/% 1-1-14 *20%0007urnitures and fi(tures 1%10%0008easehold improvements *00%000
Accumulated 9epreciation% 1-1-14 0%000Accounts pa/a+le% 1-1-14 1)0%0006an 3alen% Capital% 1-1-14 1%400%000&ales *%$20%000Purchases %0)0%000
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ATENEO DE DAVAO UNIVERSITYSCHOOL OF BUSINESS & GOVERNANCE
ACCOUNTANCY DEPARTMENT
ACC 6 Financial Accounin! & R"#o$in! III %PS Macuo'CPA() S"*")"$' AY +,(-.+,(/P$"li* 0ui1 (
&alaries 1%)40%000Pa/roll Ta(es 110%000!nsurance #0%000"ent 40%000tilities 120%0008iving '(penses 10%000
%420%000 %420%000
The entit/ is in the process of negotiating a +an: loan. The +an: is requesting financialstatements prepared on the accrual +asis of accounting.
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ATENEO DE DAVAO UNIVERSITYSCHOOL OF BUSINESS & GOVERNANCE
ACCOUNTANCY DEPARTMENT
ACC 6 Financial Accounin! & R"#o$in! III %PS Macuo'CPA() S"*")"$' AY +,(-.+,(/P$"li* 0ui1 (
9uring the course of an audit% the CPA o+tained the following information
1. Amounts due from customers totaled P*0%000 on 9ecem+er 1% 2014.2. An anal/sis of the accounts receiva+le revealed that an allowance for dou+tful accounts of
P40%000 should +e provided.. npaid invoices for purchases totaled P0$%000 and P1)0%000 on 9ecem+er 1% 2014 and
9ecem+er 1% 201% respectivel/.
4. The inventor/ totaled P)$0%000 +ased on a ph/sical count of the goods on 9ecem+er 1%2014. The inventor/ was priced at cost which appro(imates mar:et value.
$. ;n
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ATENEO DE DAVAO UNIVERSITYSCHOOL OF BUSINESS & GOVERNANCE
ACCOUNTANCY DEPARTMENT
ACC 6 Financial Accounin! & R"#o$in! III %PS Macuo'CPA() S"*")"$' AY +,(-.+,(/P$"li* 0ui1 (
*. ;n =anuar/ 2% 2014% the entit/ entered into a 2$>/ear lease agreement% appropriatel/classified as operating lease. This lease agreement covers the vacant lot ad?acent to the retail store foruse as a par:ing lot. As part of the agreement% the entit/ paved and fenced the lot at a cost of P*00%000.The useful life of the improvement is 1$ /ears. @o provision for depreciation has +een recorded.9epreciation on furniture and fi(tures was P120%000 for 2014.
). Accrued e(penses on 9ecem+er 1% 201 and 2014 were +,(> +,(-
tilities 10%000 1$%000Pa/roll Ta(es 11%000 1*%000
. The entit/ is +eing sued for P4%000%000. The coverage under the comprehensive insurance
polic/ is limited to P2%$00%000. The entit/,s attorne/ +elieved that an unfavora+le outcome is pro+a+leand that a reasona+le estimate of the settlement is P%000%000. The lia+ilit/ is e(pected to +e settled in201$.
#. The salaries included P40%000 per month paid to the owner. The owner also received P2%$00per wee: for living e(penses.
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ATENEO DE DAVAO UNIVERSITYSCHOOL OF BUSINESS & GOVERNANCE
ACCOUNTANCY DEPARTMENT
ACC 6 Financial Accounin! & R"#o$in! III %PS Macuo'CPA() S"*")"$' AY +,(-.+,(/P$"li* 0ui1 (
RE0UIRED21. Ad?usting 'ntries2. Accrual asis !ncome &tatement. Accrual asis &tatement of 7inancial Position
-= Poole Compan/ paid or collected during 2014 the following items!nsurance premiums paid P1$%400!nterest collected 0%#00&alaries paid 1$%200
The following +alances have +een e(cerpted from Poole Compan/,s +alance sheets12-1-2014 12-1-201
Prepaid insurance P1%200 P1%$00!nterest receiva+le %)00 2%#00&alaries pa/a+le 12%00 10%*00
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ATENEO DE DAVAO UNIVERSITYSCHOOL OF BUSINESS & GOVERNANCE
ACCOUNTANCY DEPARTMENT
ACC 6 Financial Accounin! & R"#o$in! III %PS Macuo'CPA() S"*")"$' AY +,(-.+,(/P$"li* 0ui1 (
@o plant assets were sold during 2014
RE0UIRED