1. On January 12, 20x1 Buckle co. purchased a machine that had a list price of P46,320.

Buckle co. Paid cash of P18,000 and executed a one-year non-interest bearing note for the balance. The going rate of interest was 18%. The machine has a 6-year life and no residual value. Depreciation expense on the SYD basis at the end of 20x1 is:

A. 12,000

B. 8,093

C. 14,690

D. Answer not given

E. 13,234

2. On January 1, 2017, ABC owns 15,000 ordinary shares representing 15% of the shares outstanding of DEF Corporation. The ordinary shares were acquired on November 12,2017 at a cost of P1,500,000 and have a fair value of P1,600,000 on December 31, 2017. On January 2, 2018, ABC sold half of its investment for P100 per share incurring a brokerage and commission expense of P20,000. Assume that the above securities are designated as at fair value through other comprehensive income, the unrealized gain (loss) on December 31, 2017 to be presented in the statement of financial position is

A. P0

B. Answer not given

C. P20,000

D. P100,000

E. P(100,000)

3. The following information relates to ABC Cpmpany's accounts receivable for 2018:

Accounts Receivable, January 1, 2017 - P975,000

Credit sales for 2017 - 4,050,000

Sales returns for 2017 - 112,500

Write-off -60,000

Collections from customers during 2017 - 3,225,000

Estimated future sales returns at December 31, 2017 - 75,000

Estimated sales discounts accounts at December 31, 2017 - 25,000

What amount should ABC report for accounts receivable at December 31, 2017 statement of financial position?

A. P1,800,000

B. P1,627,500

C. 1,527,500

D. 1,627,500

E. Answer not given

4. O. On January 1, 20x1, Entity A receives a financial aid from the government amounting to P 1M as compensation for loses it has incurred on a recent calamity. How much income from government grant will Entity A recognize in 20X1?

A.P100,000

B.P1,000,000

C.ANSWER NOT GIVEN

D.P0.00

E.P53,334

5. On January 1, 2018, ABC Company has investment in equity designated as at FVOCI with a fair value of 600,000. These securities were acquired a year ago at a cost of 625,000. On March 31, 2018, ABC exchanged these securities for a piece of land from MARS Company. The carrying amount of the land in books of MARS company was 480,000 and has a zonal value of 800,000. At the time of exchange, the shares, which was publicly listed has a fair value of 650,000.

Compute for the gain on exchange to be recognized in 2018 equity

A. 0

B. 170,000

C. Answer not given

D. 25,000

E. 50,000

6. On January 1, 20x1, Entity A had the following general borrowings. A part of the proceeds was used to finance the construction of a qualifying asset.

Principal

12% bank loan (1.5 years) 1,000,000

10% bank loan (3-year) 8,000,000

Expenditures made of the qualifying asset were follows:

Jan. 1 5,000,000

March 1 4,000,000

Aug 31 3,000,000

Dec 1 2,000,000

Construction was completed on December 31, 20x1.

How much borrowing costs are capitalized to the cost of the constructed qualifying assets?

A. Answer not given

B. 1,026,667

C.1,045,000

D.971,111

E. 920,000

How much is the cost of the qualifying asset on initial recognition?

A. Answer not given

B. 14,971,111

C.13,010,000

D.15,045,000

E. 14,920,000

7. On December 1, 2017, ABC Company assigned on a non-notification basis accounts receivable od P3,000,000 to a bank in consideration for a loan of 80% of the receivables less a 5% service fee on the accounts assigned. The interest rate of the loan is 12% per annum. The company collected assigned accounts of P2,000,000 and remitted the collections to the bank in partial payment for the loan. The bank applied first the collection to the interest and the balance to the principal. The interest rate 1% per month on the outstanding balance of the loan.

In its December 31, 2017 statement of financial position, what amount of note payable should ABC report as current liability?

A. 424,000

B. 400,000

C. 1,024,000

D. Answer not given

E. None