RELAX COM

RELAX COMPANY

Current assets: Note

Cash ₱ 400,000

Trade and other receivables (1) 750,000

Inventories 1,000,000

Prepaid expenses 100,000

Total current assets ₱ 2,250,000

Property, plant and equipment (2) ₱ 5,600,000

Investment in associate 1,300,000

Noncurrent assets:

Intangible assets (3) 350,000

Total noncurrent assets ₱ 7,250,000

Total assets ₱ 9,500,000

Current liabilities:

Trade and other payables (4) ₱ 1,350,000

Mortgage note payable- current portion 400,000

Total current liabilities ₱ 1,750,000

Noncurrent liabilities:

Mortgage payable- remaining portion ₱ 1,600,000

Bank loan payable- due June 30, 2022 500,000

Total noncurrent liabilities ₱ 2,100,000

Shareholders' equity:

Share capital ₱ 3,000,000

Reserves (5) 1,400,000

Retained earnings unappropriated 1,250,000

Total shareholders' equity ₱ 5,650,000

Total liabilities and shareholders' equity ₱ 9,500,000

Accounts receivable ₱ 800,000

Allowance for doubtful accounts (50,000)
Total trade and other receivables ₱ 750,000

Note 2- Property, plant and equipment

Land ₱ 500,000
Building 5,000,000
Machinery 3,000,000
Equipment 400,000
Total ₱ 8,900,000

Accumulated depreciation (3,300,000)

Carrying amount of property, plant and equipment ₱ 5,600,000

Accumulated depreciation:

Building ₱ 2,000,000
Machinery 1,200,000
Equipment 100,000
Total accumulated depreciation ₱ 3,300,000

Note 3- Intangible assets

Trademark ₱ 150,000
Secret processes and formulas 200,000
Total intangible assets ₱ 350,000

Note 4- Trade and other payables

Accounts payable ₱ 350,000

Notes payable 750,000
Income tax payable 50,000
Accrued expenses 60,000
Estimated liability for damages 140,000
Total trade and other payables ₱ 1,350,000

Note 5- Reserves

Share premium ₱ 300,000

Retained earnings appropriated for plant expansion 1,000,000
Retained earnings appropriated for contingencies 100,000
Total reserves ₱ 1,400,000