It arises in the course of the ordinary regular activities of an entity.

= Revenues

It is the conventional or traditional approach in preparing the income statement in conformity

with PFRS. = Transactional

The following are items in other comprehensive income that will be reclassified subsequently to
profit or loss, except = Change in revaluation surplus

To compute for cost of goods sold a decrease in finished goods is = Added to cost of goods
manufactured

It is the change in equity during a period resulting from transactions and other events, other than
changes resulting from transactions with owners in their capacity as owners. = Comprehensive
Income

The following important data affecting the retained earnings should be clearly disclosed in the
statement of retained earnings, except = Effect of change in accounting estimate

The unrealized gain or loss upon disposal of an equity investment measured at fair value through
other comprehensive income is reclassified to = Retained earnings

The unrealized gain or loss upon disposal of an debt investment measured at fair value through
other comprehensive income is reclassified to = Profit or loss

To compute for cost of goods sold a decrease in finished goods is = Added to cost of goods
manufactured

The components of "other comprehensive income" include the following, except = Loss on sale
of equipment

Expenses include the following, except = Extraordinary losses

Bronze Company provided the following information at year-end:
Share capital            6,000,000
Share premium            3,500,000
Cumulative translation adjustment- debit            2,000,000
Treasury shares, at cost              700,000
Retained earnings            1,500,000
Cumulative unrealized gain on option contract designated as              600,000
cash flow hedge

What is the shareholders' equity at year-end? = 8.9M

Tanzania Company reported operating expenses other than interest expense for the year at 40%
of cost of goods sold but only 20% of sales. Interest expense is 5% of sales.
The amount of purchases is 120% of cost of goods sold. Ending inventory is twice as much as
the beginning inventory.
The net income for the year is P2,100,000. The income tax rate is 30%.

What is the amount of sales for the current year? = 12,000,000

Mercury Company showed cost of goods sold of P4,320,000 after the first year of operations.
The total manufacturing cost comprised the following:

Materials used 50%

Direct labor incurred 30%
Manufacturing overhead 20%

Goods in process at year-end amounted to 10% of the total manufacturing cost. Finished goods at
year-end amounted to 20% of the cost of goods manufactured.

What is the amount of the direct labor cost incurred? = 1.8M