Search & Filtering
January 1 of the current year, Phobos Company acquired 10,000 shares of Investment in equity designated as a Fair Value through Other Comprehensive Income of Deimos Company at P 400,000 plus brokerage expenses of P 20,000. On March 1 of the current year, Deimos Company ordinary share was split on a 5 for 2 basis. On October 1, Deimos Company made a Special assessment of P 3.20 per share on all ordinary shareholder. Phobos Company accordingly paid the assessment. The fair value of December 31 amounted to P 30 per share:
1.The necessary entries on January 1, will include a
a. Debit to financial asset at FVTOCI, P 400,000
b. Debit to financial asset to FVTOCI, P 420,000
c. Credit to cash, P 400,000
d. No journal entry
2. The necessary entries on December 31, will include
a. Debit to financial asset at FVTOCI, P 400,000
b. Debit to financial asset at FVTOCI, P 300,000
c. Credit to Unrealized gain, P 250,000
d. Credit to Unrealized gain, P 140,000
January 1 of the current year, Phobos Company acquired 10,000 shares of Investment in equity designated as a Fair Value through Other Comprehensive Income of Deimos Company at P 400,000 plus brokerage expenses of P 20,000. On March 1 of the current year, Deimos Company ordinary share was split on a 5 for 2 basis. On October 1, Deimos Company made a Special assessment of P 3.20 per share on all ordinary shareholder. Phobos Company accordingly paid the assessment. The fair value of December 31 amounted to P 30 per share:
Based on the above data answer the following:
1. The total number of shares at the end of the year
a. Nil c. 300,000
b. 140,000 d. 25,000
2. The unrealized gain to be presented in the other comprehensive income for the current year:
a. Nil c. 300,000
b. 140,000 d. 250,000
On January 1, 2021, CLOY Company granted a five-year term loan on P1,500,000 on GOBLIN Company. If there were no possibility of credit losses, the coupon rate that CLOY Company would charge the borrower is 10% per annum, because of the borrower’s credit rating, CLOY Company estimates that there is a possibility the borrower might default on the payments and the expected credit losses are estimated at P20,000 per year over the five-year term. Accordingly, CLOY Company charges the borrower 12% coupon rate to reflect the yield on the instrument to include a return to cover those credit losses expected when the loan is first recognized.
1. Compute for the lifetime expected credit loss.
2. Compute for the 12-month expected credit loss.
3. Prepare the journal entry on initial recognition of the loan.
4. Prepare the entry assuming there is no significant deterioration of credit risk for the year ended 2021,
5. Prepare the entry assuming there is significant deterioration of credit risk for the year ended 2021.
On January 1, 2021, prison granted a P20 million loan to Break Company. The loan is repayable by the on equal annual instalments of P4.80 million over a five-year term. The effective interest rate that Prison charges the borrower is 6.4% per annum comprising 4% risk-free rate and 2.4% for credit risk. Prison estimate that there is a 70% chance that the loan will not default, a 20% chance that the loand default and the expected cash flow in each year us P3.60 million; and a 10% chance that the loan defaults and the expected cash flow in each year is P3.00 million.
Required:
1. Compute for the amount of cash shortfall for the five year period.
2. Compute for the probability weighted cash shortfall
3. Compute for the lifetime expected credit loss
4. Compute for the 12-month expected credit loss
5. Prepare the journal entry in 2021.
On October 1,2021, Venus Corp owns 15,000 fair value through other comprehensive income share acquired at a cost of P 345,000. The shares represent 15% of the shares outstanding of Mercury Corporation. On the same date, Mercury Corp, declared P 8 cash dividends on its outstanding shares payable to stock holder on October 31. However, on October 31, Mercury Corp issued 1 share for every 5 shares held by the shareholders in lieu of the supposed cash dividends previously declared.
Prepare all the necessary entries on
a. October 1, 2021
b. October 31, 2021
Operating costs (excl. depreciations & amortization): $4.5m
Depreciation and amortization: $1.5m
Interest: $0.7m
Net Income: $2.8m
Tax Rate: 35%
1. Calculate EBITDA.
2. What level of sales would generate a net income of $4.2m for the following year, knowing that operating costs (excl. depreciation and amortization) will increase by 7.5%, and given a 35% tax rate.
Write a business plan for 10,000 bird capacity broilers enterprise
On the 31/August Brain ltd has opening inventory of 20,000 goods. During September requisitions were raised for 23,000 valued at $12,000
Opening Cash was $7,000
Brain purchase 4,000 Goods at $2 and for 8,000 on Credit valued at $2 each from Law ltd
20,000 Goods were sold on credit totaling at $60,000 and 3,000 Cash Sales valued $9,000.
Of the 20,000 sold on credit the customer returned 1,000.
a) Extract Brain Ltd retail’s profit & loss statement & balance sheet elements
Problem #5
Admission by Investment of Assets
Geron, Aglugub, and Onate have equities in a partnership of P500,000, P800,000, and P700,000, respectively, and share profits and losses in a ratio of 5:3:2, respectively. The partners have agreed to admit Retada to the partnership.
Required: Prepare entries the journal entries to record the admission of Retada to the partnership under each of the following assumptions:
1. Retada invested P400,000 for a 25% interest, and bonus is recorded for Retada.
2. Retada invested P800,000 for a 20% interest, and bonus is recorded for the old partners.
Prepare the following four financial statements for Linden International Inc. for 2012:
1. Statement of income
2. Statement of comprehensive income
3. Statement of changes in equity
4. Statement of financial position
Income tax expense $ 600,000
Increase in property revaluation 35,000
Current assets 6,500,000
Cost of sales 7,500,000
Distribution costs 900,000
Common shares issued 895,000
Accumulated other comprehensive
income/(loss) beginning of year —
Finance costs 90,000
Stock-option compensation 40,000
Profi t before taxes 1,750,000
Retained earnings (end of year) 5,0Dividends paid 150,000
Other income 40,000
Gross profi t 3,500,000
Share capital (end of year) 3,395,000
Contributed surplus (beginning of year) 60,000
Non-current liabilities 5,000,000
Change in currency translation (income) 40,000
Retained earnings (beginning of year) 4,000,000
Administrative expenses 800,000
Total liabilities 8,000,000
Total assets 16,500,00000,000
