8/16/2019 CPAR_P2 07.28.13

1/6

PRACTICAL

ACCOUNTING

PROBLEI""iS

I

t

First Pre-hoald

Exalnittation

Cash

()ther

assets

Loan to

Raiph

l"iahrlities

lf Mon

receiveri

P9.000

on

assets

was

A.

80.000

Loatt

fi"o'nr

Mon

Pl0'000

Erwil1.

capitai

(30%)

45.000

Ralph,

capitut

(50%)

30"000

lvloa.

capital

(20%)

15.000

Sunday.

July

28.

20

I

3

3:00

p.m to

5:00

P.nr

D.

P4"71.399

D.

P411

.399

problem

l.Ol

October

r.20l '.

PPC

\.'onipanv

soltJ

Article

C)ne

ct-rsting

P270.000

for

P400'000

Article

Two,

a

used

article

was

ae(;i:Dle,.j

as

down

pu,o.,ir.nt

aitd

tlte

balattce

on

monthly'

instalments

ibr

two

years

thar

irrclgde

both

principal

ari.l

interesi at

lSilo

per,vear,

starting

October

3

l'

2013.

P

120,000

was

allowed

orrrlrearlicletraded-in,

firecornparryestimatesretonditionin[costofPS,000ontlrisarticleandasales

price

of

Pl

i0,000

after

sr.rt:ii

r^eronditloning'

Tlre

company,ormally

expects

20%

gross

profit

on

sale

of

usedarticles.

Howrnui,irlstlier-ealrzedgrossprofitiriZOl:f(RoLrndoffpresentvalrrefactorsto3

decirnal

places)

A.

i7"00i

Il.

-18..16.1

a.

28.750

D.28.486

probleur

?.T5e

rcr,.tyrts

rlf tlre

parruersliip

r.rf'E,i'uiit.

iialph

arl'l

Mcrir

at

the

etld

ol

its

fiscal

)ear

ol.)

SepternLrer

i0. 201-i

ri'e

as

tbllorvs:

p

I

:.000

liii.000

i.0c0

5u.000

tlie first clistribution

of

cash.

tlie

cash

realizecl

ft-om

the

initial

sale

of

D.

15.000

B.

65.000

c.

95.000

Froblem

3

apcl

4.psalrn

is

currently

preparirrg

its

conrtrinecl

fitrancial

statenlents.

On

December

3l'

2013'

ihe

houre

ofllce accouni

sl,{x,,';r

balance

of'{+s:,:OO.

T'he

branoh

sent

a

check

for

P12,000

on

December

3l

,:013.'lhe

home

ofl'ict

di,J

rtot receive

tlie

check

urrtil

,lanuarlt

4.2C14

Ftrrtherrnore'

Psalm

shipped

nrerc6andise

costiug

Pl0"00C

to the

branch

ot..

l)ecenrber

28.

l0ll at

a transfer

price

of

P25'000''Ihe

merchandise

was

rrot

lc:eiii:ci

b'

the brailcl-'

i.ttltil iallititr'l

lt.20l4'

Lastly'

adr"ertisirig

expenses

trf

P8'500

were

allocated

by.

I?sallr

i,r tire

lrrarrch.

Tlris

rvas

rectlrded

a::

P5.800

by

the

brrarrclt'

j.

Hor..

rl;uch

is the

ad.iusted

bala:,tle

cl

the

reciplt)t)al

accotlnts'l'

A.

P480.00;.

B.

1492.0(10

c'

P500.000

4.

Hc.',

intt':I

rs the

ulad-ilisled

balatlce

of

tlie

branclt

accoutrt'?

A.

P-i1{0.000

"i.

Pr'q2.C00

C'

P5u0.U''r0

Problem

5.Cerry |r,;rrpatl)'

adds

ttr:ter:'iaI

is avaiiable

lbr

Jun,.::

a.t rhe,;1a:-i

of

pr.oclrrctir--.r,,

The

follow'ing

production

infbrmatiott

V/hat

is

thl

eost,';,"r

ll

lttrits iratt:;1i:rreii

lLtt

ttsittg

the

l'ti:O

rnethcd'l

A. P2Q

r

0-l

+

B.

P 191.289

c.

[']287.004D.P298.029

problem

6

par-rl

arjr-i,iis

Claire

as a

partner

irr business.

iust

beli:re

th*

t:afitlersliip's

iormation.

Paul's

books shurred

thc

foilowing:

Cash

Accounts receiv'able

Merchatrd

i se i ttvetrtcln

Acccxrltts

payahle

PaLrl. capital

2.60ij

i:"00i)

Iti.t,0(l

6.200

26.40(i

(45%

corlplete

as

qqgryqMglU

110.000 units

_

__(80% 99ryp 9ii

i;1o

,q 19tr19'il

units

I

Current

Period

C'osts:

_MateLia

Con

t,e

r ,

'a

it

8/16/2019 CPAR_P2 07.28.13

2/6

It was

agreed

that.

tbr

establishing

Paul's

irrvestrrent

in the

tlrrn.

the

tollovrilrg

adjustnrents

shall

reflectrd:

o

Ailo*arrce

tbr

bad

debts

of

2o'i,

shourlci

be set

up'

o

Merchanclise

inventory

should

be

valued

at

P20.200'

o

lrr.epaid e\pense

of

P350 and

accrued

expelrse

of"P400

shorrld

be

rect-r5tltized'

Hclvr

nruch

cash

should

Claire

iuvest tr"r

SCCuli'A

f)tli:-lhir,1

iilt*t"ir,.f

irl tl,';

pafiitership?

A

l-i.155

U.

9.{37

'1.

'".{i00

ii' ll'105

be

lrr

Depaf'tent

2

r:t

Rodel

ComPanY

j._

l,rat"riul--

-t--c;i',er"*_

] Ctrsts ]

C,tsts

-i

-

---

I

ir

i..150

Problern

7.-t

he tbllcw ing co*tts

were aciluntulated

i- -

-

cnttr*,ltt'e;red

I i

tirn, Deot.

I

L-___

__-I

"-"'"-r-

..--

I

Beirirtuirtu lrrr e

ttttlrr

i

l,,

i

7.()5{

t..r--

r

r

I

I Current Pelir.-'d Cost

I

84.00(

L ___ i__

.___l;91,01(

Productiorr

tbr A.pril iu Departurent

2

(in

urtiis):

durirrg

April:

T-

T"t^l

l

]__

_---l

I

_,P_?l-._5t'q

]

I

rr2.@q

WIP-April

I

I

rarrsli.rr':cl

OLrt

dLir';nll ;\pril

WIP-Aprrl

.i0

Matenals ale riot

add','d

irr Dr:;;artiletrt

2 until

r

Hou

much is the

sosl

irt'r*'orl;

itt

prrti:es:'-rtt,.i')

A. P

I

0.000

1'] l'-iJ.ti00

1.000

60920

cornplete

10.000

5,000

409/o

conrplete

the

le:r

etrrJ

crf

pi-acessiltg

Departinellt

2

c.

P4iJ.l

l0

D.

P50.160

ProblemsSandg.ThepafinershipofJoriteand.larrnesbegattbr-rsitresso 1

Janttarl'1.2013'

Thefollowing

assetii

were

contributeri

'oy

eaclr

partner

(the

nttn

casi'r asselr

are

stated

at

their

fhir

rilarket

Values

on

this

date).

('aslt

Itrr

crttories

Laud

Eqri

ipnrcnt

Inieresl

rlr

bcginrring

halauces

Salaiies

Renra i

nder

Jtxgc

P

l0.Lr00

.i0.000

r00-000

,la\

ntri

P 10"00u

: 0(i.(rc0

J'he

larrcl

ua.s

srib.iect

io

a

P65.000 nlorlgtrge.

r,rhich th€

pafillerslrip

as:'itt-'red

on

the

sante

date'

The

equipnrerit *ur

r,,i,.1..r to sn in:;tairrent

note-'payahle'tlrat

iracl

art

trrtpaid

princiPa

anlount

of

P35'000

on

JanJa.l

L

l0l3. l-hE

p..lrtnersl:ip

also

assurned

this,lot.

lrul'rtl..

Accordirlg

to

ilre

partnership

agreement.

each

panner

\vas

to

har.,e a 50

percent

cirpital

int,rrest

r,'tt

January

1.2013"

with

total

parlnership

capitai breing P300.000.

Jorse arrd

Jal,nies

agreed

to

sirtre

pa(rrei'sllip

itrcotne

and

losses

in

the

fbllou

irrg

rnanrrer:

Jaytnes

10 /-

AU

P

I

6.00()

,1i9/o

Durirtg

l0l

l.

tlrc ibllr-.w ing

t.r

ctrts

or;curretl:

e

ln,,errtol'\

\\as

aettrire,l at

a cost

t-rf P]0"0()0.

A-t

l)t:t:erltb'-'r

I

i.

20

13. the

partnership

r'llvcci

F6'0[10

to

its suppliers

{

^,r

rlre

,irrrrroqrrp

:urred

on

trre

 

Prirrcipal

ttl

Pl$.000

rvas

paid

on the

rlroi'igage.

ittte:est

c\pell:ie

lllc

nlortgage

rlas

P-i.CiO0. all

8/16/2019 CPAR_P2 07.28.13

3/6

age

J

8,

The capital

credit

to

Mr.rngo

Lloyd

upon

his adnrission

trust

be:

A.90.000

B.

100.900

c' 88'000

9.

'fhe

capital

baiar:ce

of Jorge.

after

Morrgo

Llo;,d's

adnrission

tnust be:

A.

l8l.34C

B.

i63,140

c.

175'040

D.

80"000

D.

167,300

Inlormation

for

nurr.rbers

l0 and

ll

ABC

Corporation

has

two

hrranches

tc

wirich

rnercirandise

is trarrsferred

at

'-:ost

pltrs 20%'

plus freight

c6arges.

drr

Novernber

30.2013.

ABC

shipped

nrerclran< ise

thar

cost

P5^500

to

its

('ehlu

brattch"

and

the

p200

shipping

charge

was

paid'o;,

ABC.

On

Decenrber

15.2013.

the

Ilocos

branch

encountered

an

inveutor),shor-tage.

arrd

the

Cebu

bi-anch

slirppecl

tlte tuercltatidise

to the

llocos

branch

at

a

freiglit

cost

of

pl60

paid

br

the Cebu

brnnch.

Shipping

charges

iiorn

tlre

ltome

office

to

the

llocos

branch

rvould

ltave

been

Pl

75.

10.

lf'tlre

rnerclraudist.is

tiirsold

ai

\ear

circl.

the

Il.rct-rs

branch

rrili

inverrtorr

the

ttterchalldise

at

lvltat

a l11r)tl

llt'l

A

P6'es0

B'

P6'gl0

c

P6'775

D'P6'575

ll.

lf

tlre

rnerchandire

is uns'tld

at

),ear

errd,

irow

nruch

wouid

A.BC

irlcir"rCe

as

itlVetrtorv

in

its repoft

to stocklrolcer

s'i

A. Pi.67s

B' P5.850

c'

P5'500

D'

P5'47s

prgblern

l2.Yuiln-v

Yc,":Lrr"t

Cornpany,produces

-y-oc,ut1

itt

two

depaftrnents-Mi|illg

and

Finishing

ln

Mixirrg"

all

ingredierr,.e\c(-pr

iiuit

are aclCed

at

tlre start

of

production' In Finishing,

frtrit

is added

and

theii the

nrirture

;;

i.,i:i.-;cl

into contairiers.

A,Jding

the

fi'i:it

to

the

basic

yogurt

nixtltre

increases

the

volunre

transferrcir

iir LLl the

utrrnber'of

r,.a ions.,ltirir

aclclecr

.

Any

spoiiage

that

t)cctlrs

is

irt tlre

Fillishirrg

Depari;rrer,t.

Spoil,y-e

; detectecl

.irrst

b,eliire

the

rogtiil

is

plar:ed

iillo

c0tltaitlers

or at

the

98

percellt

crtmpletiilu

poirrt. /ril

:,poilage

is i'ihtlcrrtial.

l'inishing

Department

BWIP

(

100% liuit.

0%

cotrtaitrer.

30%

CC)

(lal

lons

tlansl'erred

in

Callons

of

il"Lrit

added

EWIP

(

100%

tiuit. 0%o

ctlttaitter"

609/o

CC)

Abnornral

spoilage

BWIP

Costs:

Trarrst-erred

ln

Fruit

CC

(lurrenr

(losts:

Transf'erreC

lii

Fi"iiit

C.,'ontainers

C]C

l'()tal

Cosr:i

Problem

l3. Tlie

following

irrfbrmation

relates

to Job

i\o

to

rreet

a

cLtstolner's

order:

Di rect

rnaterials consuired

Dir'ecr labor

rate

per

hottr

Productr.iort ol'erhead

pel

ciireii

labor

liorrr

D irec

t

labo

r

lt

ou

rs

etrr

p

i

.,', c

ii

Adrrrinistlatir

e

artd

othet

overlt.::id

ctlst

Profil nrarktip

What

is the sellirrq

prict:

r

the

custotner

of .iob

2(r85;

A. 17.i33

tl.

l0.8ti0

How

ruuch

is

tlte cosi

of units

tratlsi'erred

rlr.tt

t-tsitrg

l"ieiC,litec-i

evcrage'/

A.

148.826

B.l9r.

i35

C''

i

70.080

D.

165,210

i685.

wliich

is

being

carried

out by

Flexy

Fleet

Dept.

A

_

-Depf-B

5.000

gailons

5.50t)

i"200

1.700

gallons

1.000

$

e.700

r0.50c

15.000

12"400

s4.000

l r.000

--

i)8.900

s 2l

0.600

P5.000

4

4

400

209/u of

lLtil

prLlclrrctioll

cost

l:r%

oi

sellirrg

price

P3.000

5

4

200

(.'

r9.800

D.

16.2s0

8/16/2019 CPAR_P2 07.28.13

4/6

Problem

l4.Shiprnents

receivecl

tiom

the

home

oft'ice

are billeri

tt l.}Catcabt,-ve

cost.

During

the

year.

the

branch

received

shipmenls

billed

at

P360.000.

and retunred

clnrnageil goods

rviilr

rillecl

priie

of

irZq.OOO.

The

branch

has

an

endirtg

invL'irt(ri'\

of

i'71.000.

at

billed

price.

-l'.he

hr"rLrrh

repofied

ioss

of

p10.000.

How

tnuclt

is

the

balance

of

tlte

allt-inance

l(lr

nrarkup

acrlc,unt br.fbre

r*r,r-a,',ii

arl.iustnrents'l

A.

P56.000

B.p8u.u0L

c.

pi83.271

i).

p44.000

Problenl

l5.ln

2013"

Bobadilla

Construclisrl f'1.np6,r,,tegan

consaructir:n

rvork

under

a

three-year

contract.

The

corrtract

price

is

P600.000.

;r..har l'.

r,ses

tlle

pcrceirtitge-ol'-con.rpletion

nlethod fbr

financial

aecoulltillg

pLrrposes.

J'he irrcorne

to

he recoglrized

ear:lr

5,ru,

iu ir;iseil oir rhe

ilropor-tion

eil

ct-lsts

inctlrred

to

ttital

eslitnated

costs

frir

cotnpleiing

tlre

uontract. Tlre tlnancial statement

prescntati()n.

related

to

this

colltraci

at Decenrber

_l

l.

l0l

j.

tirllow:

Statement

of

f

inancial Positinn

Accr:unts

recei

i,ab

les-constructir-rrr

Conrract

bjllings

Construct

iori

i

lr progress

l

c)s:

c(,ntr?:t

billingrs

(

()sts

of'rrrrcornpieled

c,)lltraci

iil

Excess

of

biliings

Incorne

Statement

Gross

prrtfit

(h,,-filr.r_,

ta:,)

rer.:or,.rrized

it,

l0lt

t50.;.100

:)q.,lE-u

Problern

16.(Jn.ialtuarl

1.2013.

lr.arl"

rrc.

sirlned

r.r

ti,.r:elniirt authorizing

Mr.

rJe

['asiro

Io

operate

as

a

franclrisee

tbt'arr

ir:itia

fianehise

f'ee

ol'P5.0{i0.0r'r

(r:-

11-,i,

enro .mr. F2"000.t100 rvas received upolt

signing

of

tlre

agreeitietrt

and

rhe

tralance

e.,,idericrul

ir

:

it,9,c pr6rrrisscir\

tloie

lllrich

is due

in three

atrttual

ittstalltnettt-s

o1'

Ill.000.t)00

eaclr

hegirin:nr,.

i),-.c::r"nirri l l.

l0I

i.

lr,1r'.

de Castro

started franchise

operailcins

ort

Septetnbei'

I .

2 0

I 3

after

Karl

rentlered

irr

itial

senr

ices

"eqrrired

at

a tota

I

cost of

P I

"500.000.

The

flrst

ittstallnlent

',1'at

t:oller:ted

on

due

date.

The

collectibiliil

oi

the

ncte

is rrot

l.rrrrionirb:',/

assured.H.w

rnur:h

rre:

iucuni,:

is

io

lre

i.i-crg;riz,:c.i

on

Dccember

31.2013?

4..

p2.i00.tiu0

B.

p2.580.000

c.

p600.000

D.

p1.080.000

Problern

l7'

Jack

Cornpattl'

ttrattuf'actures

picture

fiarnes

ancl

rrses.iob

r--,rder

r:osting srsteru. The

lbllowing

costs

relate

lo

tl.le

crlrrenl

procluctir.rrr

ruu:

F.stinrateilorerheird/:xcltr.,iret:fspoilage)

pl6CCrl0

Spoilage

(estinrateci)

l5.ir00

Sales

value

of

spoilecl

il"anres

I

1.50{i

Labor

hours

l00.ti0r)

ll.-::i:'11,t,1tt.?ii

j:p"ilecl

lj'arne

is

P7.00.

f)uririg

rhe pcrit.ld.

I70

fianie:;

ar.e

spt,iJeti.

Each

spoile

8/16/2019 CPAR_P2 07.28.13

5/6

.

Assuuriirir

the

jOiirt

cost

are

allocated

using

tlre

ad.iLrstecl

sales

''alLre

tlleth'od'

$liat'ioint

costs

were

allocated'to

product

B

and

rvhat

is

the

sales

vaiue

at

Split

otrof

A.

respectivell:

n.le.ooo

u,i,t

os.ooo

c'

15'000

and

60'000

B.

14.286

and

63'000

D'

12'000

and

60'000

How

muchis

the

total

estinrated cost to complete

b-'

the

end

of

2012'?

A.

2.800.000

B.

1.000.000

.

l'400'000

protrleur

2l.ou

Jirly

I.2013.

DrRCF

cornpany

signe

8/16/2019 CPAR_P2 07.28.13

6/6

Problenr

27.11apro.iect

required

50

hours

to

contplete

at

a

cost

of

Pl0

per hour.

but should

have

taken

only

45 ht'rurs

at

a cost

of

Pl2

per

hour.

Wlrat

is

tlie

proper

journalentry't9 record

the

costs?

What

is

t[e

cost

al|:cateil

ttr

prodrrct

E']

A.

PI17.600

B.P122.400

A.

Work

in

process

I.ahor

price

valiatlce

Labor

effi

ciettcY

variance

Payroli

PaYable

B.

Wages

expellse

i.atror

etfi

cietrcY

v'at'iattce

Pa1'roll

PaYable

(

.

W'ork

in

Plocess

PaYroll

Pa1'a[rle

D

Work in

Process

Labor

eft-icietlcl'

variatrce

l-abor

Price

r''ariance

Payroll

PaY'able

Pr',;blem

l8.The

fbllowing

selected

accolrnts

appeared

of

Deceruber

31.

2013:

Instalment

receivable-2012

sales

P

15.000

Ittstalmerttreceivable-2013

sales

200'000

Inventor').

Decetrlher

j

1.2012

70.000

Purchases

I

555-000

Additional

in[ormation:

Page

6

ct.

Pl

19.512

D. P

121.200

60

500

50

500

500

5,{0

OU

100

500

in the

trial

balattce

of

Bab1,'

V.

Sales

Cornpattl'

as

460

100

550

500

Repossessions

lnstalnrent

sales

Regular

sales

Deferred

gross

Protrt-201

2

P

3.000

415"0c0

i

85.000

50.;60

P

r20.000

95.000

i0oZ

orr

sales

Irrstalniettt

receivable-

?0 il

sales.

Decetlber

3 i'

20l2

lnventorl,,

clf

irerl

aucl

repossessed

mercltartdise

as

of

Deceprber

3

l.

201

-l

Cross

protit

percetltage

ott

regttlar

sales

dLrring

tlte

1'ear-

Repossessiolrs

\

ere

nrade

dirring

the

accourtl

at

lhe

tittte ot'rept'sscssitrii

as

A.

l-14.5l0

B.

245.010

p16bie6

29.

pedro

Cornpanl

has

a

c1,cie

tiine

of

3

days.

uses

a

Materials

and

In

Process

(MIP)

account'

a,d

charges

allconversion

costs

to Cost

of

Coods

l;oicl.

et

the

end

of

each

niortth.

all

invelttories

are

counted.

tlreir

conversiort

costs

(CC)

compollellts

are estimated,

and

inventory

account

balances

are

ad.f usted.

Raw

nraterial

cost

is

backflushed

fl'onr

MIP

to

Finished

Coods.

The

tollowirig

intirrr-rtation

is

1br

J

uue:

Yea|

l'

oras

a

l0Il

sale

attd

thc

corresponding

Lrnctlllected

P7.l()t).

What

is

tire

trr'iai

i'er,lizc.'l

e.i

\):i-

ir r)fli'l

c.245.b10

D'246.010

P29.2s0

P I

0.000

of

CC

30.000

562"500

32.000

ot'('('

26"150

D. 563.500

66

)13%

P

r

q2.000

360.000

c.

.180.000

A.

561.000

B. 56

i.250

l-

-,t;r-1,150

probleut

j0.Jualita

Corlpap;-

uses

iustallrrient

rref

ltod

olaccoutltitlg

arld

has

the

following

data

at

lear

end.

Beginning

balance

MIP

account

inclLrding

P3,000

CC

Beginning

balance

of

finished

goods account.

inclLrding

Raw

nraterials

received

ort

credit

Ending

MIP

inr,entory

per

phl,sical

count.

inclUding

P.1.500

olccl

Endin

fl,isirecl

g..ocis

i'i

r.i-.ror\

per

piil

sicrl

co,,t.

i.cluc1i,gPll.750

What

is the

t'lil

tlaterial

e

ost tli-

Lttlits

corttpleted

itl

Jtt:li:'')

Clirss

rlargin

ott

cost

Ll

urealized

gross

protit

Cash collections

includirrg

doun

pa)'lrerlts

What

was the amotttlt

of .iale

tltt

it-:st;iilirietti

A.

646.000

s s

2.000

i1.8.i0.000

.)asrs

D