An excerpt of the Joint Company's trial balance for the period ended December 31, 2021 revealed the following liability balances:

Accounts Payable

P 420,000

Provision for Warranties

273,000

Accrued Salaries Expense

770,000

Bonds Payable, 10% maturing December 31, 2024

2,000,000

Notes:

a.Accounts Payable balance refers to the accounts of suppliers of the merchandise. A purchase cut-off procedure was conducted to entries several days before and after the balance sheet date in the purchase journal. The corresponding inventories were appropriately included/excluded in the count. The result of the cut-off procedures are as follows:

December 2021 entries on the purchase journal

Receiving Report No.

Receiving Report Date

Amount

Remarks

2132

December 18

P 26,000

FOB Shipping Point

2133

December 22

40,000

FOB Destination

2134

December 28

19,000

FOB Destination (From a Consignor)

2135

January 2

24,000

FOB Destination (In Transit)

January 2022 entries on the purchase journal

Receiving Report No.

Receiving Report Date

Amount

Remarks

2817

December 31

P 25,000

FOB Destination

2818

January 2

23,000

FOB Destination (In Transit)

2819

January 3

41,000

FOB Shipping Point

b.The company's inventories are covered by a two-year warranty program. Sales in 2020 and in 2021 covered by the said warranty are 2,600 units and 3,200 units, respectively. The company estimates that 20% of the units sold will be returned for repairs in the year of sale and 30% of the units sold will be returned for repairs on the year following the year of sale. The company also estimates that the cost per unit returned for repairs will be P 300 for parts and labor. The balance in the provision for warranties account is the amount accrued in the prior period. No entry has been made by the company during the year in relation to the warranty except for the actual repair costs incurred during the year in the amount of P 388,000, which was charged to current years warranty expense.

c.The accrued salaries expense included employee unused compensation absences amounting to P 560,000, which was the accrued amount at the end of the prior year and employee incentive bonus amounting to P 210,000, which was 10% of the net income after 30% income tax and after bonus (before any adjustments)

As of December 31, 2020, the employees had an accumulated 1,750 days of unused vacation and sick leaves. In 2021, employee exercises 1,200 days from the leaves carried forward in the prior year. Additional 1,400 vacation and sick leaves were earned by the employee in 2021. The average daily salary rate of employees increased by 10% during the year. The company estimates that from the cumulative unused employee leaves, only 80% shall probably be exercised by the employees.

d.The bonds were issued on January 1, 2020 when the prevailing market rate was at 12%. The bonds pay interest every December 31. The company recorded the bonds issuance by debiting cash for the cash consideration received, crediting bonds payable account at face value. The difference was charged to interest expense. The only other entry made by the client were the payment of annual interest on December 31, 2020 and 2021.

A. What is the correct carrying value of the bonds payable as of December 31, 2021?

B. What is the adjusted Accounts Payable balance as of December 31, 2021?

C. What is the adjusted provision for warranties balance at December 31, 2021?

D.What is the correct accrued salary expense related to the accrued bonus as of December 31, 2021?

E. What is the correct accrued salaries expense related to the accrued compensated absences as of December 31, 2021?