Intermediate Accounting 3

Activity 2 – Statement of financial position

Problem 1
Helena Company reported the following data on December 31, 2020.

Cash in bank, net of bank overdraft of P100,000 2,000,000

Petty cash, unreplenished petty cash expenses P10,000 50,000
Cash set aside, withheld from wages for income tax of employees 20,000
Notes Receivable 1,000,000
Accounts receivable, net of accounts with credit balances
Of P500,000 4,000,000
Subscription receivable 1,500,000
Inventories, including goods received on consignment of
200,000 2,000,000
Bond sinking fund 1,000,000
Property, plant & equipment, including P1,000,000
Carrying amount of equipment classified as held for sale 10,000,000
Accounts payable, net of accounts with debit balances of
P100,000 1,700,000
Bank Note payable – 12% 3,000,000
Mortgage payable in quarterly installments of P250,000 4,000,000
Accrued expenses 300,000
Share Premium 3,000,000
Retained Earnings – appropriated for contingencies 1,500,000
Subscribed share capital, 30,000 shares 3,000,000
Unissued share capital 3,000,000
Retained earnings – unappropriated ?

a. The 12% bank note was issued July 1, 2018 with a term of 5 years. The terms of the note give
the holder the right to demand immediate payment if the entity fails to make monthly interest payment
within 10 days from the date the payment is due. On December 31, 2020, the entity is three months
behind in payments.

Required: Prepare statement of financial position with appropriate notes.