Question
DM Corporation provided the following trial balance on December 31, 2X20 which had been adjusted, except for income tax expense: Cash 675,000 Accounts receivable (net)
DM Corporation provided the following trial balance on December 31, 2X20 which had been adjusted, except for income tax expense:
Cash
675,000
Accounts receivable (net)
2,695,000
Inventory
2,185,000
Property, plant, and equipment (net)
10,245,000
Accounts payable and accrued liabilities
1,800,000
Income tax payable
1,500,000
Deferred tax liability
750,000
Share capital
2,500,000
Share premium
3,000,000
Retained earnings, January 1
3,350,000
Net sales and other revenue
15,000,000
Cost and expenses
10,000,000
Income tax expense
2,100,000
27,900,000
27,900,000
The accounts receivable included P1,000,000 due from customers and payable in quarterly installments of P125,000. The last payment is due December 30, 2X22. During the year, the estimated tax payment of P600,000 was charged to income tax expense. The income tax rate is 30% on all types of income.
Requirement: On December 31, 2X20, compute for (3 items x 5 points):
a.Total current assets
b.Total current liabilities
c.Retained earnings
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