PROBLEM 5-6
PROBLEMS STARS COMPANY Stars Company is a business that has been incorporated for over 25 years. The company adoptsa fical year from Apr or from April 1 so March 31. The following informacion rotates in the liabilities of Stars for the current focal-year ended March 31, 2012: Notes Payaldoes Stars has simed several notes with financial institution and insurance companies The maturise of there noom are gen below. As of March 31, 2042, interest expense recorded before any actrials amounts to P1000 Thetotal unpaid interest for all ch are led anaccused amounts to 10,008 Macurry Date Amount Due P108 090 July 1, 2022 204 0 October 1 2022 April 1, 2043 June 30, 2023 406060 November 1 2021 December 31, 2103 TOTAL P3.004 090 Premlung Stars has maund ap rogram list theal year where each box of Produc I commins me coupon, which Ifsahmined with Pin, emirkes the customer to a complementary Product V. The com pony expects that Part of the coupons will be redeemed. 495 190 for each Product Y and incars additional Pio for handling and shipping costs upon redemption. The following information is available on the promotional program of Last Fiscal Your Current Fizzal Your Number of Product X boxes sold 71000 Salling price per box Number of complimentary Product Y purchased 26000 32000 Number of complementary Product T nmaning at fiscal your-and 5000 Warranties Bars commenced a two-year warranty progam during the carrent year It is meanated that warranty costs shall be approximately 175 in pantsand 130 in bbor per unit retu med. The company further estimates that 2/3 of the units sold shall be returned during the warranty period with fi rearnedon the year of sale and cochon the yar following the sale For the comment fheal your, the company receded sales of 16004 010 from the produces covered by the warranty with each unk sold at 12 030. Moreover, actual warranty cont's incurred a mounted to 19:,000 which the company charged to warranty expome. No other entries were made by Stars related to the warranty program. Bonus: Stars grants as company president an anavail bonus Said boavas is composed a beak amount equhakan so 10% of the company's hit incame before deducting the bonus but after dadacting the corporate income tax, which is deductible in computing the company's Emuable Income Sean moigained a net income of PLOD Out for the carrent Theal your before deducting both thean maal bonusand the corporate income tax based on a 30%% rate Dividends On March 15 2042 Bars Company's board of directon declared a cash dividend of Pu 75 per share and a 19% stock dividend. Both dividends were to be distributed on April 12 2022 to the ordinary shareholders of record at the close of business on March 31 2022 Dain regarding the oompmysommer ARE We CA10 OWL Par whe per share Number of shares issued Number of charm out sanding Maria vole par share March 31. 2032 P2150 PROBLEM GERNG COMPANY The condensed income statement of BUND Company for the year ended December 31 20132 is presented bbelow wall Company come Natement For Me pair andel December 31, 2021 Cost of Goods Sold Grum Prom Opanting Income 250/600 Other income (expense Income before tin Income tax expense (309) 210800 The December 31, 202 audit of the company's financial siemens disclosed the following ETTOIS January 1 2027 inventory is undetated by P17600 December 31, 2024 Inventory & had by P31,008 3 Accried Interest income of 15,030 and una hed revenue of P11000 in 2021 were not recognized in the company's books Accried siaries expanse of P4000 am not recognized in the company's books Sam of P5.G00 were not recorded until Jan vary 3023, although the goods were shipped In December 20012 and were excluded from the December 31 physaal Inventory Purchases of 130600 made in December 2027 were not recorded aldough the goods were received and properly inchaded in the December 31 physical Ivemory. A macheve win sold for 10600 on July 1. 2027 and the peaceehs were credited to the Sales account, The machinewas acquiredon January 1. 2019 for P60,090 At that time it had an estimated Wife of 6 years wah no nskiual vale. Akin, ac depreciation was recorded on the machine in 2022. A potent was acquired at the begining of 2022 Sir Pain,Doa No amortization expanse has been recorded for it since its acquistion. The patent had a 10-year woeful life with no residual value on the date of acquisition A Byear fire insurance policy purchased on April 1, 2020 for Pra,000 was batright on the year of purchase. 10 The beginn wadit ady soments # P248525. Dividends
