Problem 3 - DINNER CO.

Dinner Co.
Statement of profit or loss and other comprehensive income
For the year ended December 31, 20x1
Notes
Sales 16,800,000.00
COGS 12 (8,390,000.00)
Gross Profit 8,410,000.00
Distribution costs 13 (3,090,000.00)
Administrative expenses 14 (2,910,000.00)
Impairment of PPE (290,000.00)
Finance cost (280,000.00)
Profit before tax 1,840,000.00
Income tax expense (552,000.00)
Profit fot the year 1,288,000.00

Other Comprehensive Income

Revaluation decrease during the period (120,000.00)
Translation gain on foreign operation 25,000.00
Other Comprehensive Income for the yr., net of tax (95,000.00)

TOTAL COMPREHESIVE INCOME FOR THE YEAR 1,193,000.00

Problem 6- Multiple Choice- Computational

1. D
gross of tax 25,000.00
less: tax effect 10,000.00
net of tax reclassification adjustment 15,000.00

2. A
3. A
Actuarial gain or loss on defined benefit plan (6,000.00)
Unrelaized gan on FVOCI securities 30,000.00
 Reclassification adjustment for cumulative gain on translation of
foreign operation included in profit or loss
(5,000.00)
profit for the year 154,000.00
Total Comprehensive income 173,000.00

4. C
Unadjusted bal. of advertising expense 146,000.00
prepaid advertising (15,000.00)
accrued advertising 9,000.00
Adjusted advertising expense 140,000.00

5. A
Contribution to youth and educ. Programs 250,000.00
contribution to health and human-service organizations 140,000.00
contribution shouldered by employees (80,000.00)
Charitable contribution expense 310,000.00

6. A
Finished goods
Jan.1 400,000.00
COGM 200,000.00 240,000.00 Cost of sales
360,000.00 Dec. 31

7. A
total credit in trial balance 600,000.00
total dedit 420,000.00
profit before tax 180,000.00
profit after tax 126,000.00

8. A
Advertising 150,000.00
Freight-out 80,000.00
rent for office space 110,000.00
sales salaries and commissions 140,000.00
total selling expenses 480,000.00

9. A
Accounting and legal fees 25,000.00
officers' salaries 150,000.00
insurance 85,000.00
total general and administrative expense 260,000.00
Notes:
Note 12: COGS
Beg. Inventory 2,100,000.00
Purchases 6,800,000.00
Purchases returns (480,000.00)
Freight in 350,000.00
Total goods available for sale 8,770,000.00
Ending inventory (380,000.00)
Cost of Goods Sold 8,390,000.00

Note 13: Distribution Cost

Freight out 870,000.00
Sales commissions 480,000.00
marketing expenses 320,000.00
salaries of sales personnel 670,000.00
rent expense 210,000.00
depreciation expense 540,000.00
Distribution Costs 3,090,000.00

Note 14: Administrative expenses

Salaries of administrative personnel 2,520,000.00
Rent expenses 210,000.00
depreciation expense 180,000.00
Administrative expenses 2,910,000.00