CPA REVIEW SCHOOL OF THE PHILIPPINES Advanced Financial Accounting pene m i Pre-week Materials (Practical Accounting Two) 4, i a < On January 1, 2020, Toni: Abbie and JM entered into articles of co-plrtnership for the operation of TAP computer shop. Toni codiributed Investment property with assessed value oPR1,700,000 subject 1o mortgage payable of 500,000 to be assumed by the ip. Abbie contri uipment with cost of P600,000 with accumulated depreciation of P200,000. The fiir mark puter equipment is P300,000. On January 2, 2020, the partnership was able to sell the inyeSument property Yor P2,000,000. How much cash shall be contributed by JM ifthe article of cop Provide it Ton wil OE rest inthe pareship? a. 500,000 F ow —_ Y ». 700,000 ew f ©, 800,000 hurd (etarctoed) 3 aA 4. 600,000 cigars oat ¢ & Dn January 1, 2010, Ys and Nadine organized YAN partnership by investing PSM, 2M and P3M for capital interest ratio of eotively. Nadine has been appointed as managing partner. During year 2010, ke partnership repor’si net income of P3,000,000, Their profivioss distribution ang drawiny ent are presented below: $F a 20% interest on beginning capital 4 a tp uo 10,000, P20,000 and PS0,000 monthiy salary, respectively 25% bonus of net income after interest and salary to managing partner yn} iv. The remainder will be divided equally amng the partners. crear et Gai te wnat cemetrtnpepPe 1S what thcapil blanc of Nane on Besar 31 2010 ¥ aa atta : k it» £ i Biss te un hee Po January 1, 2030, Carta, Aika and Roma organized CAR partnership wherein Carla contributed PIM for 20% Interest in the partership, Aika contributed PSN. for acaptal erst of P2.5M. After closing the accounting book, Aika and Roma made drawings of P300,000 and P100, 000, especie. The 7 At epee. Ther pies eget a presented i, Quarterly salary of P20,000, P5,000 and P60,000 respectively af ~ fo, ii, The remainder will be divided in the ratio of 1:5:4 , + ‘On December 31, 2030, the capital balance of Roma is 1,690,000. What is the net income of the parmership for ‘the year ended December 31, 20307 a ) = La am 2 sio.00 al _ Tey b. 300,000 <4 2 2) 240.00 ‘ ‘ y “4. P440,000 7" & 4. ‘Using the same data in the preceding number, what is the capital balance of Aika on December 31, 20307 a. P2,200,000 7 Hoy 4D Diao ‘b. P2,220,000 a4 DE ee. (250° 9») a. P20,000 < $/On December 31, 2010, the capital balance of partners Aiza, Ren and Trish of ART Partnership are P2 Lig ts rai ie oo ‘admitted to the partnership by sequiring 40% of Trishyeagital interest and profit i ee of PIS00,606° ARTS partnership roported PIM net incoms for year X01}? What is the capifal balance, yDecember 3]. 2017 pir SI ® P1740.000 3 té say ‘b. P1,900,000 « s © Pladoooo 7 a. P1600.000 a ee 1s tO eteu) : = 4p * 6. Using the sae data jn the precoding number, what ste capil balance Aig on December 1201 2 100,00 eee OS ‘b. P2,130,000 SNE \ ©. P2,040,000 Chee tem SE G 4. P2,070,000 ae PoE Lo ayae iy ee ee, 5 ‘December 31, 2020, the capi and POM, respectively with prore snd received P400,000 from the race ‘of 4:1:5, On January 1, 202 ed PAO, the partershin TP 5 time of retirement, ow much isthe cen assets ofthe partnership are 1 balance of parmers Cristy, aula and Ara of CPA Partnership are PIM, PIM sty decided to retire F900 balance of Paula after the retirement of \ sad b. P2,850,000 7 gS te ot 2.100000 ‘) ie ers / 4. P3,150,000 Gs g ww ¥ 6) a x meet na, O40; he septal balance of partners f, Alice and Rein of BAR are P2M, PSM and PIM, 7’ Tespectively with profit or loss aprement rio of 2:3:5. On January |, 2041, Ena was adited 0 BARE arnership upon investment of PIM for 25% interest in the new pi with nev, igtalagregs capitaizai "16M, How much sth share of Alen thease ea ay al . % ‘b. P2,500,000, el ea CE Fee cnet: 2) Pan d.P3,125,000 Oo, In - ae tt pesto = Re ee ei mmutee: ‘what is the bonus received by Ena from the old partners? b. P1,200,000 & ©. P1,000,000 & 4. P1,500,000 10. Using'the in ou yr a aa i sob sane dain mame 8, hat st otha es aaa aor ze um He wel b. PI,500,000 Py ©. 3,500,000 ere 4. P500,000 @ rf inancal Poston of iC Parmership with profit or loss ratio of 4:5:1 Cash IM Liability to third person 2M Advances to A oM Advances from B IM Noneash asset oM ‘Advances from C 2M A, Capital oM B, Capital 3M Capital IM On January 1, 2001, ABC partnership isviqfideted herein liquidation expenses amounting to P400,000 has been incurred. If partner B receives PIM, evo sie by Cth tinge liquidation? ‘a, P2,400,000" A. b> —F Cf \ '. P1,000,000 eo 7 , 2,000,000 z None @ the 1g the same data in number 11, what isthe net proceeds from the sale 1. 3,000,000 Qukh tt J b. 4,400,000 low) e. P4,800,007° 4 Lal 13. Secember 31, 2010, the Statement of Financial Poston of DEF with profi or loss rt ted it wut 2M Libiltywhied ponon $M foncash asset aM D, capital : x E, capital 13M F, capital 1M January 1,2011, DEF partnership has been subjected o installment liquidation. As of December 31, 2011, the On Jong data concerning liquidation are provide following cash asset with book value of PEM has boen old at loss of P2M. us Nona expen amourting © PAN 000 ha een incured forthe mo of nay. > paboj000 cash hasbeen witbeld for frre liuidaton expense. ¢ > aM liability hasbeen paid. mis Pe be nai os ha ine maxi posible os on Se aNG A «71300000 Cano wee on X (ao CY) te. P1,000,000 ree en ae bas 9 os ree co oe +) Page 2 of 17st ing the same data it is ig the pe ii ‘number 13, what is the amount received by E on January 31, 20117 b. 700,000 b ©. P1,000,000 dd. -Notie reer) b. P120,000 Heine 900 wren & pio echt, ee (oSe, bic et g . Using the same Gata in m 15, what is the amount ti ef) créditors wiphout priority? wrt % Wap the Nutbbiin, the sale of spake asses of liquidated corporation resulted to net proceeds of P1,000,000. iquidation expense emounting to 60,900 has been paid at the start of liquidation. Before the liquidation, the following data are provided concemité the financial postion SPtHE sald financially distressed corporation: ficiency amounting to (P340,000.) > The corporation has total assets with book value of P2,000,000 and de AP An investment property with book value of 'PS00,000 and realizable value payable amounting to P100,000. > Taventary with book value of P1,000,000 and realizable valve of P100,000 secured a note payable ‘amounting to P200,000. > Salaries payable and income tax payable amounted to ‘What is the amount received by partially secured cre ‘of P300,000 secured loan 40,000 respective: agqo P600,000 £ psmmano # (an 2) ¢. P700,000 4. 800,000 Zee we oe 17, On January 1, 2020, VINO Ine. and Oppo Inc, estab so, smanufscturing entity under thd trade name Create oo a2 Ne OF IE corporatonWillte owned equally by VIVO In. and Oppo Iie, This com eer Ino, The common ashone components tht car be sold tothe incorporatos and third peso. Te Mrngement between VIVO and OPPO provides Vat the relevant ectvitis of rosie Ine. wil ined to operste at breakeven. The assets and liabilities of of the sai Create Inc. is normally reais Tne. ee crte the name of VIVO and Oppo. The contractual arrangement provides for the following assets ana Tabilities the business: ’ re of VIVO but it widhemewet for the mortgage payable. > The land will be in the nam F The building will be owned by OPPO bet it wil! shoulder the loans payable. 7 > Other assets, liabilitics and elements of finenciat statements Ser be shated on the basis of their equity interest. “The statenenn of financial position of Create Inc, as of Decemer 31, 2020 is present below: Current assets 10M counrs payable 20M Building 30M Leen payable 40M Land 60M Momgege payeble 10M Grdinmy sock 4 20M ef 10M Retgines comings Gp inclusive of sales te VIVO and OPPO in the During 2020, Create Ino. revorted ‘otal sales amounting ¢9 Ding ep iOM and PaOM, respectively. During 1/20, VIVOTwas able to Fost 80% of iaventory ‘from Create infurd persons while OPPO was able io resold 50% yiventory from Create 1 hid pesos }PPC) Inc. in relation to his interest to this arrangement for What isthe amo svanue to be reported | the yer ended December 1, 207 Bea! . . weed Oo” b. —_P10,000,000 Cor 3 pe % &Fiso0.000 (eK aZa+ @ —P19,000,000 = v (Af: Psing the same data in number 17, what is the amount of La be reported by VIVO line. in relation to his Ko oer thi arangement sof December 3, 20207 C me oeat 8g : k ‘ P65,000,000 b, 35,000,000 te Cv) 7 6, 50,000,000 4. 60,000,000, 79, Qsing the same data in numicr 17, whats the encunt of cal Hiliies 10 be reported by! i har ig angen Det 312020) —$—$—~ ¥ $50,000,000 uP we ‘e. 35,000,000 4. 20,000,000, Page 3 of 17 NO ai een i:|g gegumQteaca ‘ empl ty ay £30, Ayala Ind, and SM t rhe Create oe units The contractual arrangement between Ayala and $M provides thatthe relevant activities of In, wil require unanimous vote ofthe sid partes, The incorporated entity wil have over the «assets ofthe operation xd will answer for the libilties ofthe said operation. The parties {the=weraBfats of the operation, Ayala Inc. and SM Inc. invested PIOOM and P1SOM, 7 for 40:60 | Interest in the said established corporation. The financial statements of MRT7 Inc. for the 3 years of operation provided forthe following data: ‘Year ‘Net incoms/(Net loss) Dividends declared 2030 50M. 10M. 2031 300M) _ 2032 400M SoM On Devember 31, 2032, fair value less cost to sell of the Investment by Ayala and Investment by SM is ‘determined to be P130M and P205M, respectively. ‘What is the book value of Investment tobe reported 1c. on December 31, 2030? a P180,000,000 y '. 174,000,000 ©. P144,000,000 4. 150,000,000 21. Using the sary umber 20, what is the igyeinent on tobe reported by Ayala Ine. for the year ended December 31,0317 a, P120,0003 8. 116,000,000 y © 124,000,000 7 & Piod.o00.000: (Gat sme an nye 2 a ak tea ob et by Al December 31, 20327 x eee Me PRBS ae GN) (Segre mio what sth book vale of neste be predby SM neon December 1, 20327 a. P210,000,000 d & ». 204,000,000¢ oy ©, P205,000,000 aon 4. P208,000,000 a es ete LIMA Inc. and incurred transaction cost of P1000. PKI Inc. owned 50% interest in the said corporation. For the year ended December 31, 2020, LIMA Inc. reported net income in the amount of P$00,000 and declared dividends in the amount of P200,009, On Decembgr-31_2070, PKI determined that the fair value +om—OFHs: Investment in Lima is P1,500,000. The cost to sell bf the fair value. The value, ‘the investment io opnini tape = r bain: coke) ky 46 ‘What is the book value of the Investment on December/31,_ to be reported by PKI Inc. under the different models? Fair value mi Cost method Equity Mie 7 K. ts FE (SP snged v. 1,200,000 1,500,000 Ue! 1,100,000 « Tacs ©. 1,100,000 1,200,000 1,500,000 fe \ 2a" a 1,500,009, gg 1,100,000 1,250,000 ‘of PKI Ine. in relation to this investment for the year ended December 31, 2020 model “GF, Cost msthod Equity method de 300,000 increase <4N* 100,000 i 200,000 increase b, ae uaretas P200,000 increase £250,000 increase mee P300,000 increase 1,000 decrease 4 200,000 decrease 251,000 inarease 100,000 increase| 26. installment price of P100,000. Abenson received 200 as down payment. The fair value of the tadein TV paid in equal quarterly installment su epee st of P90,000. Abenson defaulted on the payment of cr of the television set with appraised value of P10, 000, ‘was resold ata cash price of PZ5;800 afer being reconditioned ‘What is the realized gross 2 PS DOb ss Profit tobe recognized by Abenson ne forthe year ended December 31, 2010? b. 20,000 \) ©. P7,000 4d. P22,500 7. Using the same data in number 26, what i ‘i “ ended Deco ja apnumber 26, what isthe loss on eposesion tobe recogized by Abenson Ic forthe your a P1250 ». P5,000 ce. P3,750 4. P2,500 28. Using the same data in number 26, what is the realized gross profit to be tized by Abenson Inc. fo ended December 31, 2011? ene on nee a P3,750 b. P15,000 «. P12,750 é. P18,750 29, On January 1, 2001, MDC Inc. entered into a long-term construction contract for the erection of iiding at a grice of PLOOM. Because of changes in the design of the project, the price increased by January A008. The project i completed on December A 2004 The fllowing ations! data. are pro we ‘ion fee equivalent to 3% of original gontract price must be made by the client deductible on the first billing, Billings on the project are made a, 2 aries ‘of the contract price, respectively, for the ve first three years of the project. Gov > MDC made eaah collection ftom the customer amoting to PHGM and P3OM on year 2002 and 2003. } The cost incurred on year 2001 is FIOM while te complete at the end of 2001 is PAOM. > ‘The cumulative cost incurred as of year 2002 i ith percentage of completion of 50% as oF the end of 2002. YO. ge 4 - ©) > The cost igcumed on vent th percentage of completion of ‘of the end of 2003, ae ‘What is the excess of cor SETESS Over progress billings (excess of progress billings over construct in progress) on December 34, 200) jer the following models? aw) - seen) aa Cos msoven gg 8) a P8M (P2My~ b PIM PIM . PSM 3M) 4 POM ro 30. Whats the realized gros fit (oss) forthe year ended éeember 31, 2002 der the elo wing models? + Percentage of completion Cost recovery.” ~ (P30M) (40M) (PSOM) (P50M) (PaoM) (P40M) om) ‘None yp n number 30, what is the balance ‘of construction in progress under the following models on 3 re of sk F Cost ry Percentage of completion recover PiosM— 90M. A 90M ‘PLOOM 100M POBM ir 4 Fiom Be aber 31, 20037 ‘32. What tie amount of account receivable to be reported MDC of December 31, ‘a P15,000,000 si b. P28,000,000 © 25,000,000 Cc 7 PI8,000,000 Page 5 of 17. On, 5 TAY 1, 2020, Taza Min Inc. granted a franchise right toa franchisee for the operation of coffee shop us Mia's trade name for a period of 10 years starting January 1, 2020, Te takin Comrie or taerundable inital franchise fee of PIOM snd continuing franchise fee of 10% of franchisee’s annual sales. ts ie ligation of Taza Mia to construct the coffee shop and to deliver the movables. In addition to that, Ttza Mia has the obligation to deliver 100,000 units of raw materials to the franchisee, The stand alone selling price of the ‘ght to use Taza Mia's trade name is PAM, The standalone selling price of the construction of the coffee shop Gelivery of movables is P3M while the stand along selling price of the 100,000 units of raw materials is PIM. Qn Tuly 1, 2020, Taza Mia finished the construction of the coffee shop and deliver i 8s. 5) Se ly 2a ni onstruction of the coffee shop red all the required movables. v 1 materials have been delivered as of December 31, 2020. The francisee reported sales revenue ‘mounting to P2M for year 2020. ‘What is the amount of total to be re ia. n eRe esate sported by Taza Mia Inc. forthe year ended December 31, 20207 . 4,700,000 & P8,750,000 . 4, 5,700,000 , wee er 34. On Desember+;-2007,Gawad Kalinga, a nonstock ponprofit organization, received PIM fund from a Philanthropist who impost the condition that said shall only be used for the research project of the ‘organization. On December 31, 2010, Gawad Kalinga |00,000 of the said fund far the research project. r sors Oecd Semen Cheep ‘What is the effect of the transaction Gf Gawad Kalinga for the year ended Dect 31, 20107 a fie ncn Td as 'b. Decrease in temporarily restricted net asset by 100,000 Y) ees aye 4. Davee ured eset by P1000 b ‘who stipulated that the amount should be inucsted indefinitely in revenue producing AAvestment. The deed of donation also provides that the dividend income shall be used for the gequisition December 31, 2020, Red Cross Inc. received P200,000 cash as dividend income from investment of the fund, (On January 152021) Red Cross Ino. acquired a personal computer at a cost of, with a useful life of $ ‘years without re¥iial Value. How shall the transactions be roported in NPO's S of Activites for the year ended December 31, 2 wW @ There shall be increase in unrestricted net asset by PS0,000. co b. There shall be decrease in temporary restricted net asset by P200,000. ©. There shall be increase in permanently restricted net asset by PIOM and increase in temporary restricted net asset by P200,000. 4. There shall be inerease in unrestricted net asset by P10,200,000, 36. Using the same data in number 35, how shall the transactions be reported in NPO's Statement of Activities for the ‘year ended December 31, 20217 TS SO etky cn erred @) OY, ‘a. There shall be increase in unrestricted net asset by P50,000. fg Cb BERS eer ce en ra 7 c. There shall be decrease in temporary restricted net asset by P50,000 and increase in unrestricted net asset by P40,000. dd. There shall be no effect in total net asset. 37. Using the same data in number 35, how shall the cash flows be reported in NPO's Statement of Cash Flows for the year ended December 31, 2020? ‘8. Cash receipts from operating activities by P200,000. 'b. Cash receipts from financing activities by P10,200,000. ‘e. Cash disbursements for investing activites by P200,000. 4. Cash disbursements for financing activities by P10,000,000. 38, Using the same data in number 35, how shall the cash flows be reported in NPO's Statement of Cash Flows for the year ended December 31, 2021? ‘a. Cash receipts from operating activities by P200,000. b. Cash receipts from financing activities by P10,200,000. ©. Cash disbursements for investing activities by P50,000. 4. Cash disbursements for financing activities by P10,000,000 Page 6 of 177 oath (HALALad) 39, On December 31, 2016, the Department of Foreign Affairs it its buildi of P100, “ign 8 billed its lessee on one of its buildings in the amount 100,000. On January 31, 2017, the DEA collected all of the accounts receivable. On aoa 28, 2017, the itted al} the collected amount to the Bureau of Treasury. What is the journal on the ‘DEA entry to eer’ the reminance othe Bureau of Treasury? — Accounts Receivable P100,000 and Credit -| Rent Income P100,000 ‘Debit ~ Accounts Receivable P100,000 and Credit ~ Retained Earnings P100,000 ~ Cash Collecting Officers P100,000 and Credit ~ Accounts Receivable P100,000 b ©. De ) 4 a ~ Treasury/Agency Deposit, Regular ~ P100,000 and Credit Cash ~ Collecting Orficer — Department of Health romi book of DFA entry to a 40. Using the same data in number 39, what is the journal entry on the book of Bureau of Treasury to record receipt ‘of remittance from DFA? 8. Debit LBP — Current Account and Credit Cash - Treasury/Agency Deposit, Regular b. Debit ~ Accounts Reesivable P100,000 and Credit — Retained Earnings P 100,000 ©. Debit ~ Cash Collecting Officers P100,000 and Credit — Accounts Receivable P100,000 4d. Debit - Cash ~ Treasury/Agency Deposit, Regular ~ P100,000 and Credit Cash — Collecting Officer ~ 100,000 41. On January 1, 2016, the Department of Public Works and Highways (DPWH) reccived a P10,000,000 appropriation from the national government for the acquisition of construction machinery. On February 1, 2016, DPWH received the allotment from the Department of Budget and Management. On March 1, 2016, DPWH centered into a contract with CAT Inc. forthe acquisition of the machinery with a price of P8,000,000. On April 1, 2016, DPWH received the Notice of Cash Allocation from Department of Budget and Management net of 1% ‘withholding tax for income '2x of supplier and $% withholding of Final Tax on VAT of supplier. On May 1, 2016, CAT Ine. delivered the machinery to DPWH. On June 1, 2016, DPWH paid the obligation to CAT Inc. On July 1, 2016, DPWH remitted the withheld income tax and final VAT to BIR, What is the journal entry on July 1, 20167 ‘a, Debit Cash-MDS, Regulary P7,520,000 and Credit Subsidy Income from National Government 7,520,000. b. Debit Machinery 28,000,000 end Credit Accounts Payable P8,000,000 ©. Debit Accounts Payable P8,000,000 and Credit Duc to BIR P480,000 and Cash-MDS, Regular 7,520,000. a. Debit Due to BIR P480,000 and Credit 'sidy Income from National Government P480,000. had ce ctered into a contract of merger wherein PNB will issue 100,000 price of P20 to the existing shareholders of Allied in exchange scqustion related cost of business combination amounting to 3,000 and stock issuance cost amounting ? As of December 31, 2030, PNB has total assets book vaiue of PSOM and fair market value of ile Allied Bank has total assets with book value of PSM. and fait market value of PAM. The net assets of Allied Bank on December 31, 2030 is P2.6M. ‘What isthe toal assets of PNB on Janwary 1, 2031 after the merger? a, P54,000,000 — CA WSO b, 64,000,000 ‘e. 55,000,000 & 4. 65,000,000 43. Using the same data on number 42, what is of exalt on bargain purchase) arising from busi combination? usiness ‘& (P600,000) 'P800,000 b. . 600,000 j 4. 400,000 | 42. On Januazy 1, 2031, PNB and Allied Bank ordinary shares with par value of Pi0 ond q aa forthe net assets of Allied Bank. PNB Page? of 17Toa ha puted 80% of outstand ‘ar value of P100 and quoted price of P200, On the sit has book value of P39M but a building with remaining useful feof 10 yor bomen M dan equipment to SM at a gain of P200,000. On the date of sale, the equi ‘ Seat a lends of 1,000,000, The retained earings of SM on December 31, 2019 is @ ve nea te et ee a b. 7,130,000 © 6,480,000 4. P7,120,000 45. Using the same date in number 44, what is SM's consolidated net income attributable to parent’ the your ended Deceusborsi wa to parent's shareholders for 6,368,000 . P6,648,000 ©. 6,448,000 4. P6,288,000 46. Using the same data in number 44, what is. ‘noncontiolling interest in net assets as of December 31, 2020? a. P7,092,000 " b. P7.112,000 Ne P6,092,000 d. P6,112,000 47. Using the same data in number 44, what isthe consolidated retained earings as of December 31, 2020? 7 & 716,120,000 b. P15,368,000 ©. P17,130,000 d. P15,480,000 48. On January 1, 2010, Ayala acquired 90% of outstanding ordinary shares of Globe Inc. The following data are rovided: ree On year 2010, Ayal sold inventor at price of P,000,000 with gross prof us of 20% bated on sae to SP Gite. 40% remained in ending inventory of GTGBEO December 31, 2010. These inventories are eventually sold on year 2011 to third persons by Globe. ‘gy * 08 year 2011, Globe sold inventory a w pie of 50,000 with gros prof of 40% based on sale to ‘Ayala, 10% remained in ending inventory of SM on December 31, 2011, '* On year 2011, Ayala reported saies of PIOM while Globe reported sales of PAM. On the same year, Ayala reported gross profit of PIM while Globe reported gross gay ‘What is the Ayala's consolidated sales for the year eniled December 31, a. P12,500,000 b. 14,000,000 ©. 13,000,000 4. 13,500,000 49, Using the same data in number 48, what is Ayala’s consolidated gross profit for the year ended December 31, 20117 ) ‘9,060,000 o> 'b. P8,940,000 ©. 8980.00 d, P9,080,000 Page 8 of a77 bor bees wayea q 50. On January, 1, PLDI |» PLOT acquired 60% of out | xing efi wa aa cna Sa with @ gain on bargain purchase | ° deprecation of aoe pe oe 24 * Diack equptent to Sma with com of PIM and seunulaed | MN On Tuy 1, ope ee eligi of 800,00, The bck equipment has cig! feof S your eo os ee Sar Sold a white equipment to PLDT with cost of PS00,000Yand accumulated Pte son a selling price of P150,000. The white equipment has origfaal life of 10 years. y ” Teported net income of PSM and declared dividends of P2M while ‘Smart reported net income of PIM and declared dividends of P500,000. ‘What isthe consolidated net income a. 85426250 b. 5,626,250 © 6,422,500 4. P6,622,500 attributable to parent's shareholders forthe year ended December 31, 2022? the noncontolling interest in net income forthe year ended December a. PAI7,500 b. 420,000 \ . 405,000 4 425,000 52, Using the same data in number $0, what isthe consolidated depreciation © the equipment for the year ‘ended December 31, 2022? ke a. 250,000 th @ b. 225,000 ©. 125,000 ¢. P1I2,500 ' 453. Using the same data in number 50, what isthe conslidatedsG0k Value of the equipment on December 31, 20227 a. 375,000 i \ b, P412,500 » j © 350,000 2d) 4. 425,000 ort ooh coe ene MO! Te cot yo 1,2030-Wer inc. acquired 70% of cutsiading shares of PS Inc. ata price of PIM. Metro incurred a sg ahs, nt 7 fading of tein of PIM, Mo eed reported net income of 30,000 and declared divider in the amount of P100,000. | In the separate financial statement of Metro, the hvestmert in PS Inc. shall be reported on December 31, 2030 | ‘what amount under these modeis? 2 etbboe {WN przecone bi zra0 Fonte a. 1,000,000 P(,200,000 455, Using the same data in number 54, in the separate Fnancal statement of Metro, what is its income in relation to Investment in PS forthe year ended December 31, 2050 under these models? equity method Cost wethod 2 245,000 e700, b 70,500 - 245, io rs pasieee AO P70.000 a. 80,000 770,000 apn La... “il36. 0: we On December 1, 2001, Noy Ine, whch is operating inthe Philippine, sold gods on sssbunt is USA company 4 price of $1,000 collectible on March 2, 2002. In order to hedge this exposed foreign currency denominated accounts receivable, Noypi entered into a forward contract with BPI for the sale of $1,000 to be delivered on March 2, 2002, The following direct exchange rates are provided by the bank . 12/1/2001 12/31/2001 3/2/2002 Buying spot Pao P37 P38. Selling spat: Pal Pas PAS Buying forward-30 days P38 P32 P35 Selling forward-30 days P34 336 Buying forward-50 days. —~ P43 ep a Selling forward-60 days P40 if Pas Buying forward-90 days P42 P40 P38 Selling forward-90 days P34 P40 P36 What is onsen to be recognized by Noypi Ine. for the year ecsirceiiacsi ay? a 1,000 A , . P4100 pow ag thet c. P34,000 4 P42\000 57, Using the same data in number 56, what is the book value of Noypi’s Accounts recei for sas ended December 31, 20017 o XK 2. 37,000 ne ‘b. P43,000 & coo Am d. P35,000 58, Using the same data in number 56, what is the foreign currency hedged item forthe year ended December 31, 2001? 1. P20,000 gain mi YE Bowie = 7 ©. P10,000 gain 4, 40,000 loss 59, Using the samo date in nutber $6, what is the foreign currency gain or (loss) to be recognized by Noypi on hedging instrument for the year ended December 31, 2002? 110,000 loss Cy 'b. P10,000 loss : ©. P30,000 loss = 18" 4. F20,000 gain ‘On November 1, 2010, Noypi ine., which is operating in the Phiippines, purchased investment property in USA at a price of $10,000 payabie on January 31, 2011. in order to hedge this exposed foreign currency denominated ‘accounts payable, Noypi entered into a forward contract with BDO for the purchase of $10,000 to be collected on January 31, 2011, Noypi luc. accounts for its investment property using fir value model. On December 31, 2010, the fair market value of the investment property is 312,900. The following direct exchange rates are provided by the bank: unre 125 U2010 132011 Buying spot P40 P37 P38 Selling spot P50 Pa Buying forward-30 days Yee? P32 P3S Selling forward-30 days P34 Pat P35 Buying forward-60 days 3 5 pas | Selling forward-60 days 40 aD P43 Buying forward-90 days 4 FAO P38 Selling forward-90 days «0 P40 Pe ‘What is tKe book valbg of izvestment propery og December 31, 20107 a. P444,000- Ee, b, 600,000 A ‘e. PAB0,000 4. r4o0.00 & Page 10 of 761. Using the same data in f data in number 60, what is the gain (loss) on changes in fair market value of investment property ‘elusive of foreign curency gun forthe ear ned December 31,2010? ® P90,000 6. P150,000 © P60,000 4. P100,000 data in number 60, what is fre foreign curpery gain or (loss) in relation to investment property the year ended December 31, 2840? 9,000 . P150,000 ©. 60,000 4. 100,000 63. Using the same data in nygubey 60, what is the foreign currency gain or (loss) in relation esha the year ended 107 ‘. (P20,000) b. 50,000 c. P30,000 4. (P10,000) . Using the same data in number 60, what is the foreign currency gain or (Joss) in relation to hedged item for the year ended December 31, 2011? a. P20,000 b. P10,000 fe. P30,000 d. P40,000 On November 1, 2010, Juan Inc. entered into a forward contxéct to buy $2,000 with Metrobank to speculate on the changes in the value of dollar, I¢ will be delivered on 1/31/2011. The following direct exchange rates are provided by the bank 11/1/2010 12/31/2010 19172011 Buying spot P40 P37 P38, Selling spot Pas P50 Pas Buying forward-30 days P38 P32 P35 Selling forward-30 days P34 Pal P36 Buying forward-60 days P43 3S P46 Selling forward-60 days P40 Pal P43 Buying forward-90 days P42 P40 P38, Selling forward-90 days P43 Pao P36 ‘What i the foreign currency gain mee - On September 1, 2016, 2B Co. anticipated the purchase of merchandise from a forei ign vendor at a pri $1,000, The purchase would probably occur on January 30, 2017. On the ‘Co. ieee Co, purchased call option to buy $1,000 at an option price of P20 by paying option premium ae ie ‘The forecasted purchase occurred on the date anticipated. For the year ended December 31, 2 purchased inventories from the foreign vendor were sold to third person, » 2017, only 40% of ‘The following additional data are provided: ‘nin016 12a12016 rn0nni7 Selling spot rate P20 P24 P21 Fair value of call option ’ 5,000 ? ‘What i the forcign currency gain or (loss) to be recognized in profit or loss forthe year ended December 31 P4800 gain b. P4,000 gain © 1,000 gain 4. P800 gain Pa 11 0f17% c. P1,000 gain P80 gain 68. Using the same data in number 66, what is the foreign currency gain or (loss) to be recognized in Other Comprehensive Income for the year ended December 31, 20177 4,000 loss b. P1,000 gain © 3,000 loss 4. P2,000 gain 669. Using the same data in number 67, what is the cumulative other comprehensive income in statement of financial position as of December 31, 20177 ‘, 400 cumulative debit b, 600 cumulative credit ©. P200 cumulative debi 4. 800 cumulative credit 70. Using the same data in number 66, what is the net foreign currency gain or (loss) to be recognized in profit or loss for the year ended December 31, 2017? ‘a. 400 gain © ‘aise c. P200 net gain 4d Povonetion ON AMY 71, On November 1, 2016, 7D Co. entered into a firm commitment with Toki-Toki Japanese Company for the export of dried mangoes with a contract price of 10,000 Yen. The goods will be delivered by 7D Co. on January 30, 2017. On the same day, in order to protect itself from the risk of changes in fair value of the firm commitment due to changes in underlying foreign currency, 7D Co. entered into a forward contract with BDO for the sale of 10,000 Yen atthe forward rate on November 1, 2016. 1AS 39 provides that hedge of the foreign currency risk of {firm commitment may be accounted for as either fair value hedge or cash flow hedge. 7D Co. elected to account for the hedge of the firm commitment using fai value hedge. The following direct exchange rates are provided: ‘November 1,2016 December 31, 2016 30, 2017 Buying spot rate Pio PS Piz Selling spot rate Pig PIs P Forward buying 90-days Pit Pls Forward selling 0-days PL PI6 PIT Forward buying 60-days PLA PIT PI6 Forward selling 60-days PIS Pid Forward buying 30-days PL Piz Forward selling 30-days P13 Pl4 rs ‘What is the book value of firm commitment asset/(liability) on Decomber 31, 20167 Come 2h we 40,000 asset 1. P30,000 asset ¢. P20,000 liability 4. P10,000 liability "72, Using the same data in number 71 what is the 20177 a. 40,000 gain b. 30,000 loss ©, 20,000 gain 4. PO 73, Using the same data in number 71, what amount recognized January 30, 20177 ‘a. 140,000 b, P120,000 Any re ¢, 130,000 4. 110,000 pd Page 12 of 17ra ag eae a te Ee ee = Pali ee azn whee she functional curency is Yen, However, te presentation o Fpanee Yor oF Doering tae proved concern Nats Stiemen of sae Pons Readand Cash Equivalent 1,000,000 Accounts Payable ¥¥3,000,000 Roce 32000000 Nets Psabl 1,000,000 3,000, mon St Property Plat and Equipment 4,000.00) Prefered Sint ooo no otal Assets ¥10,000,000 Retained Earnings 2,000,000 The following additional data are provided: i cmcabars * ‘Naruto Inc. reported net income for year 2020 ant of Y500,000 and declared cash dividends in the amount of ¥300,000 when the exchange rate ¥e Common Stock was issued last year when ange rate was P4.8 wi issued leat year when the exchange rate was P3, ec hcic eireer ‘The December 31, 2019 Retained Earnings at translated amount is P5,000,000. ‘The following direct exchange rates ae also given ‘© December 31, 2019 P450 © December 31, 2020 PS _ © Average rate during 2020 3.50 ‘What is the (1) translation gain/(loss) in OCI for year 2020 3,350,000 gain b. 3,700,000 gain ©. 7,050,000 gain 4. P6,500,000 gain jing the same data in number 74, what is the (2) cugfulative trénslation credit/debit) as of December 31, 20207 a. 3,350,000 credit . 3,700,000 credit ¢. P7,050,000 credit 4. P6,500,000 credit v vv 76. Ysing the same cata in number 74, what isthe (3) curnulative translation credit(debit) as of December 31, 2019? a. P3,350.600 credit 'b.- P2,700,900 credit ©. P7,050,000 credit 4d. P6,500,000 credit 77. BPI US is a subsidiary of BPI Philippines. The fimetional currency of BPI US is USS while its presentation ‘currency is Phil. Peso. The following items are translated at ‘Transaction rate Closing rate Accounts receivable 2M My tok! Inventory MU Mim i Sales 10M: TSM Spnace, Ckgpaten In the consolidated financial statements of BPI Philippines. the following items shall be presented at Inventory Sales a 3M 2 15M b. 32M 10M . 3M 10M 4 2M 10M abe 78. Using the same data in number 77, but assuming the eooncimy of US is experiencing | esate items shall be presented in the consolidated financial statements of BPI Philippines ‘Accounts receivable Inventory Sales a 3M aM 15M b 3M 4M 10M ° 3M, 5M 10M 4 2M 5M 10M Page 13 of 1779. ABC Company has «cycle of3 days, uses Raw and In Process Account and charges ll conversion coat (0 coat Soods sold. At the end of each month, all inventories are counted, their conversion costs components are K oS ‘What 4 ‘and inventory account balances are adjusted. Raw material cost is backflushed from RIP to finished ‘goods. The following information is provided for the month of June. Beg, Bal. of RIP account, including P1,000 conversion cost P 5,000 ‘Beg, Bal. of finished goods accounting including P6,000 conversion cost 10,000 Raw materials received on credit 400,000 Direct labor cost P300,000; Factory overhead applied P500,000 800,000 Ending RIP inventory per physical count, including P7,000 conversion cost 20,000 Ending finished goods inventory per physical count, including P4,000 conversion cost 6,000 ‘What is the amount of conversion cost in units sold in June? a. P802,000 b, 796,000 . P794,000 d. 800,000 ‘a. P391,000 b. 404,000 . P387,000 d. 395,000 ad oy? at “ oe ‘same data in number 79, what is the amount of direct materials to 6 backflushed from RIP to 300 = sing the same data in number 79, what is the amount of direct materials to be backflushed from finished goods cost of goods sold? - P395,000 . 400,000 ce. P393,000 d. 389,000 82, ABC Inc, previously is choosing between traditional costing and activity-based costing. The following data are provided: ‘Activity center Cost driver Amount of etivity Center cost Material handling Kilos handled 100,000 kg P200.000 > 2 Painting Units painted 50,000 units 300,000 - © ‘Assembly ‘Machine hours 10,000 hours 500,000 + SO Traditional Labor hours 100,000 bowrs P1,000.000 = fo ~ Job 1 contains 3,000 units. It weights 10,000 kilos and uses 300 machine hours. The direct labor hours on the job ,000 hours, What is the applied overhead under traditional costing and ABC costing? Traditional costing ABC Costing a. P70,000 P53,000 \ 4b 60,000 56,000 ©. P80,000 45,000 4. 50,000 43,000 1 Inc, has established the following standard for one unit of its product: 2 per direct material 3 direct materials per product Pl0 per direct labor hour 4 direct labor hours per product For the year ended December 51, 2010, Ideal acquired weteaae of P9,000. It produced 800 products using 2,000 direct materials. The actual cost of direct labor is P42,000 using 6,000 hours. is the direct material pri a. P2,000 unfavorable b. P3,000 unfavorable c. P1,000 unfavorable 4. 4,000 unfavorable variance? Page 14 of 17‘84, Using the same data in number 83, what is the direct material quantity variance? 1,200 favorable oo b. 1,600 favorable ©. P800 favorable 4. P1,000 favorable 85, Using the same data in number 83, what is the direct labor rate variance? ‘a. P18,000 fan b. P12,000 favorable t ©. P24,000 favorable ~ — d. P15,000 favorable 86, Using the same data in number 83, what isthe direct labor efficiency variance? 2. 28,000 unfavorable . P19,600 unfavorable & 4. P15,400 unfavorable 4. 12,800 unfavorable 87, Chem Inc, undergoes joint processing of diferent products ata joint cost of P500,000. The following products ‘were manufactured under the said joint process: ALT TAB DEL Units manufactured 20,000 30,000 * 10,000 7 Selling price per unit P10 P20 P3 DBL is e by-product which can be sold after further processing cost of PO.80 and the costo sell per nit is PO.20. During the year, the produced by-product is considered significant. —_— ‘What is the value of by-product to be deducted from the joint manufacturing cost? 30,000 20,000 ae oi gating RSS att cand A ed a. 200,000 'b. P300,000 © 7192,000 5 288,000 st 89, Using the same data in number 87, whet isthe joint cost allocated EAB usi en sv method? ‘2 P125,000 . P375,000 = « P120,000%%, * 4. ¥360,000 aly pv (NUD 90. JOB Inc, is using job order costing system to accumulate cost for its products. It employs actual costing. The {following data are provided concerning its operation for the year ended December 31, 2010: Decrease in direct materials forthe year IM Increase in work in process for the year 3M Decrease in finished goods for the year oM Total manufacturing cost for the year 10M ‘What is the cost of goods manufactured for the year? a P™ b. PIIM e. P&M 4. PIM 9. Using the same data in number 90, whet isthe cost of goods sod forthe yea? b. PI3M & PIM 4. PLM Page 15 of 17(er tt 92. Proc Inc, employs it ‘3 ; Process costing fr its inventory. Conversion costs are added uniformly. the period ile direct materials ae added 100% a the ion process. The following provided: fed 100% atthe start of the production process The following daa are provided: Beginning WIP Inventory” 20,00 unto (20% complsed as coven) Units stated 20,000 units Ending WIP Inventory 10,000 (60% incomplete as to conversion) ‘There is no spoilage during the period ‘The cost of beginning inventory is PS00,000 consisting of P200,000 direct materi onversion costs, ‘The torel manufacturing cost is P2.2M consisting of P400,000 direct materials and P1,800,000 conversion costs, ‘What isthe cost per unit for direct materials under FIFO process costing? PS Pa 6 PIs ‘and P300,000 93. Using: ‘hs same data in number 92, whats the conversion cost per unit for Average process costing? a. b. P30 ce. P2234 a d PIO.IS oe 94. Cees Tne. employs process eo its erie uniformly of the period ‘while direct materials are add atthe end of the pfoduction process, The following data are provided: Beginning WIP Inventory 1,000 unita10% incomplete as to conversion) Units started '50,000 units ‘ 5 Units compicted 40,000 units Ending WIP inventory 12,000 units (80% completed as to conversion cost) bliin oo) © Normal loss is 10% of units started during the period. Le $ tuspesia pit conus wien te prnsin 90% Yop tt conewe. tn «st EP 95. What isthe equivatent unit of production of direst materials under average process costing? 2. 40,000 b. 30,000 © 52,000 d. 60,000 96. Using the saine data in number 95, what process costing’? a. 47,8007 b. 40,600 N 2 c. 55,800 < J d. 41,400 97. The Philippine Government anc! Heaven's Path Ine. entered into a concession a and operation of Skyway 4 connéeting Tawiiswvi and Batunes. On December 31, 201 constructed the Skyway 4 at a cost of Pi00M. Heaven's Path Unc. has a right or term of the arrauigement of 50 years. The amounts to be re extent thatthe public ses the a. P100,C00.000 'b. P98,000,000 e. P98,000,000 ky 4. 94,000,000 Ce 98. The Philippine Government and St, Luikes Inc. entered into a efncession arrangement for the construction and operation of Pro-poor Hospital for a period of 10 years. Of December 31, 2010, the concession operator constructed the Hospital ata cost of P49M. The arrangement be paid a specified amount that will enable it to recover the investment made, has a pre-determined minimum order of hospital beds operating and available. St. Lukes right to receive P8M every end of the year, The interpolated effective interest rate is 109%. What is the of infrastructure asset on December 31, 20117 4, 100,000 41,000,000 \ ak fylers) pa Le ¢ wt the equivelert unit of production of conversion e9} IFO iment fr the construction the concession operator to ch over the ‘ed by the concession operatOT ae contingent on the Skyway 4. What is the bock value of infrastructure asset on December 31, 2012? eese Page 16 0f 1799. The following data were provided by the accountants of the Home Office and Branch for the year ended December 31, 2016: ; Home Office Book Net sles to outside customer 1,000,000 — Beginning Inventory 300,000 140,000 Net purchase from outside supplier 300,000 250,000 Shipment to branch 400,000 Shipment from Home Office 00.000 4 Ending Inventory 100,000 300,000 7 Operating expense 200,000 100,000 Additional Nowes: > nl Nee whole company to whi fer inventories. e > Fa yu eel Dee 2015 Hae Oc il bash Wh POH SS 4 on cost > Half ofthe beginning inventory of the branch was acquired from ouside suppliers whi) ofthe ending “faventory ofthe branch was acquired from the home office. Ae ce in its General Purpose Tneome ‘What is the (1) combined net income to be presented by the Home Off Statement for the year ended December 31, 2016 and Graach 7p its separate income statement for the year ended SY 2) understatement of net income reported by December 31, 2016, respectively? ‘a. P270,000 'b. 300,000 . 290,000 d. 320,000 100, Using the same deta in number 99, what is the understatement of net jocome reported by the branch in its ‘separate income statement for the year ended Decemer 31, 2016, respectively? 30,000 ; b. P10,000 ap ©. 20,000 4. 40,000 01, ABC Co. established a branch in Lipa City. On December 31,2005, he eles ‘on Decenber 31, 2010, the home office account has an unadjusted balance evonciling items are discovered by the home ABC Co. nce ranch collected the receivable of aan branch worth P2000" but failed to Lipa brane ve paid Lip’ payables worth PL,000 but filed to inform the brane Fae om orth 30,000 intendedo be delivered ts San Jose Branch was delivered to Lipa branch which ‘was retained by the latter, (xor"® By o Bed ete worth PA0,000 intended fo be delivered to Lipa Branch was delivered to Ibean branch which ‘was retained by the latter, v. ‘The branch received credit me from home office, iting 10 .000 which was credited twice by etic’ Lert Sa rae oy ome of the branch vic__The branch's nat loss amounting 1 £20,000 was debited by the to investrgent in branch, What isthe balance of ‘account on December 31, 20102 ‘a, P80,000 v b. 90,000 ©. P110,000 & 120,000 102. ‘Using the same data in number 101, what is the unadjusted balanos “31, 2010? ‘@. P70,000 w b. 90,000 © Poon ot 4. P120,001 .¢ of Investment in Branch on December Page 17 of 17 Jn ali LER sunt: