PROBLEM 5-6
5. The bookkeeper for Karen Computers Incorporation reports the following statement of financial position amounts as of June 30, 2018. Current assets 2.440,500 Noncurrent assets 6,285,500 Current liabilities 1,386 000 Noncurrent liabilities 900 000 Owners' equity 6,410.000 A review of account balances reveals the following data: An analysis of current assets discloves the following Cash P 422,500 Investment securities - trading 500.000 Trade accounts receivable 568,000 Inventories, including advertising supplies of P20,000 850.000 2,440.500 Noncurrent assets include the following: Property, plant and equipment. Depreciated book value (cost P5,560,000) P 5.490,000 Deposit with a supplier for merchandise ordered for August delivery 21,500 Goodwill recorded on the books to cancel losses incurred by the company in prior years 774.000 6.285.500 Current liabilities include the following: Payroll payable 71,500 Taxes payable 41.500 Rent payable 114, 000 Trade accounts payable (net of P15,000, 6-month note from a supplier who purchased some used equipment on June 29, 2018 999,000 Notes payable 160.000 1,356.000 Noncurrent liabilities include the following 9% mortgage on property, plant, and equipment payable in semiannual installment of P90 000 through to June 30, 2023 P 900. 000 Owners' equity includes the following Preference share capital: 190,000 shares outstanding (P20 par value) P 3,800.000 Ordinary share capital: 1,600,000 shares at Pl par value 1.600,000 Share premium 1 040.000 6.440 000 Ordinary shares were originally issued for P3,910,000, but the losses of the company for the past years were charged against share 2 QUESTIONS: Based on the above and the result of the audit, determine the adjusted amounts of the following Current assets Noncurrent assets Current liabilities Noncurrent liabilities Equity 6. In connection with your audit of the financial statements Karen Corporation, you were provided with the following statement of financial position as of December 31, 2018: Karen Corporation Statement of Financial Position December 31, 2018 Assets Linbilities and Equity Current assers: Current lisbilines: Cash P 250.000 Accounts payable P 68,000 Trading securities 160.000 Other current liabilities 40.000 Acces rec., net 427,000 Total P 108,000 Inventory 620.000 Other current assets 284 000 Long-term liabilities P 655.000 Total P1.741.000 Total liabilities P 763.090 Nowcurrent assets: Equing Property, plant and equip. P1,296.000 Share capital P1,000,000 Treasury shares 90.000 Retained earnings 1.616.000 Other moncurrent assets 272.000 Total Noncurrent assets P1.658,000 Total equity P2.636.000 Total assets P3 399.000 Total liabilities and Equity P3.990,000 The following additional information relates to the December 31, 2010 statement of financial position. Cash includes P80,000 that has been restricted for the purchase of a manufacturing equipment. Trading securities include P55,000 of stock that was purchased in order to give the company significant ownership and a seat as a member of the board of directors of a major supplier. Other current assets include an amount of P80,000 as an advances to the president of the company. No due date has been set for the payment. Long-term liabilities also includes a bonds payable of P200,000. Of this amount, P50,000 represents bonds scheduled to be redeemed in 2019. Long-term liabilities also include a P140,000 bank loan which will be due and demandable on May 15, 2019. . On December 21, dividends in the amount of P300,000 were declared to be paid to shareholders of record on January This dividend were not yet reflected in the financial statements. . Cash in the amount of P380,000 has been placed in a restricted fund for the redemption of preference shares in Both the cash and the shares have been removed from the statement of financial position. Property, plant, and equipment includes land costing P160,000 that is being held for investment purposes and that is scheduled to be sold in 2019. QUESTIONS: Based on the above and the result of your audit, determine the adjusted amounts of the following as of December 31, 2015. 1. Total current assets 2. Total noncurrent assets 3. Total current liabilities Total noncurrent liabilities Total liabilities Total equity Total liabilities and equity
