Statement of cash flows

The following information relates to Geofrost Company for the year ended December 31, 20X7. All amounts
are in thousand pesos.

Extracts from the statement of profit or loss for the year ended December 31, 20X7

Profit before tax 15,000

Less: Income tax 4,350
Profit for the year 10,650

Statement of financial position as at December 31

20X7 20X6
Assets
Current assets
Cash 2,045 1,063
Receivables 6,405 4,542
Inventory 3,560 9,635
Total current assets 12,010 15,240
Non-current assets 44,282 26,574
Total assets 56,292 41,814

Liabilities and equity

Current liabilities
Bank overdraft 1,230 429
Trade payables 7,562 4,364
Income tax payable 3,020 2,760
Total current liabilities 11,812 7,553
Non-current liabilities
Loans payable 8,000 10,300
Total liabilities 19,812 17,853
Shareholders’ equity
Ordinary share capital 19,365 17,496
Retained earnings 17,115 6,465
Total equity 36,480 23,961
Total liabilities & equity 56,292 41,814

Additional information:
 Depreciation expense for the year was P4,658
 Assets with a carrying value of P1,974 were disposed of at a profit of P720

Required
Prepare the cash flow statement of cash flows (using the indirect method for operating cash flows portion) for
the year ended December 31, 20X7 for Geofrost.

Statement of financial position

The accountant for Delicious Bakery prepares the following condensed statement of financial position:

Delicious Bakery
Condensed Statement of Financial Position
December 31, 2018:

1
 Current assets P53,415
Less: Current liabilities 29,000
Working capital P24,415
Add: Other assets 75,120
Total P99,535
Less: Other liabilities 3,600
Shareholders’ equity P95,935

A review of the account balances disclosed the following data:

a. An analysis of the current asset grouping revealed the following:

Cash P10,600
Trade accounts receivable (fully collectible) 12,500
Notes receivable (note of a customer who has been declared insolvent 1,000
and is unable to pay anything on the obligations)
Investment securities – trading, at cost (fair value is P2,575) 4,250
Inventories 20,965
Cash surrender value of life insurance 4,100
Total current assets P53,415

The inventory account was found to include supplies costing P425; a delivery truck acquired at the end
of 2018 at a cost of P2,100; and furniture and fixtures at a carrying amount of P10,400. The furniture and
fixtures were acquired in 2015 at a cost of P12,500.

b. The total for other assets was determined as follows:

Land and buildings at a cost of acquisition, July 1, 2016 P92,000

Less: Balance due on mortgage, p16,000, and accrued interest on 16,8880
mortgage, P880 (mortgage is payable in annual installments of
P4,000 on July 1 of each year together with interest for the year at
that time at 11%)
Total other assets P75,120

At the time of purchase, it was estimated that the land was worth P30,000. Buildings as of December 31,
2018 were estimated to have a remaining life of 17.5 years.

c. Current liabilities represented balances that were payable to trade creditors.

d. Other liabilities consisted of payroll withholdings, real estate and other taxes payable to the government.
However, no recognition was given the accrued salaries, utilities, and miscellaneous items totaling P350.

e. The company was originally organized in 2014 when 5,000 no-par ordinary shares (with a stated value of
P5 per share) were issued in exchange for business assets that were recognized on the books at their fair
value of P55.000

Required:
Prepare a corrected statement of financial position in report form as of December 31, 2018 with the items
properly classified.