GE1715

P-M-I CHART

Instruction: Respond to the scenario below by using the P-M-I Chart. Write your answers on the spaces
provided.

• In the Interesting box, write down some facts about the specific financial statement.

Scenario: Shark Loans received a request for a construction loan from Wendy Services Inc. This
construction loan will be used for the building of their fifth branch in Pasay. The company submitted their
statement of financial position and income statement. Help Shark Loans choose which financial
statement they would use as a basis on whether they will accept or reject Wendy Services Inc.’s request.
Refer to Page 2. Justify your decision.

Response 1: Statement of Financial Position Response 2: Income Statement

Plus Minus Plus Minus

We can see the annual This reveals the earnings of
income of the whole the business which is, The
business there. The gains Wendy Services Inc. earned
and profits has shown. 2019 was 651,990.00 and
the year 2020 they earned
514,745.00. And the total of
their liabilities and owners’
equity are the same of their
asset. Meaning, this
business is already bankrupt
due to their loans.
Interesting
It indicates Wendy In the financial situation,
Services Inc.’s income and the income statement look
expenditures. Wendy the same since they earned
Services Inc.’s Financial service revenue of 90,000.00
Statement shows the net in 2019 and service revenue
income for the entire year of 60,000.00 in 2020. Then,
which demonstrates whether concentrate on their net
there is benefit or loss. sales as they got 550,000.00
in 2019, but they only got
250,000.00 in the year of
2020. This means that the
year 2020 is diminishing.
Interesting

They’re still gaining, but their service business doesn’t Using Wendy Services Inc.’s Financial Statement, we
have any assets that can have money to pay if they’re will see the net income they earn for the year.
ever able to lend.

My Decision
My decision is to accept Wendy’s Services. Although there has an evidence showing that the business is
falling, with the proper management and skills, I think I can handle it better.

07 Activity 1 *Property of STI

Page 1 of 2
 GE1715

WENDY SERVICES INC.

Balance Sheet
December 31
200A 200B
Assets
Cash ₱166,320.00 ₱332,640.00
Accounts Receivable 119,350.00 59,675.00
Office Supplies 5,775.00 5,775.00
Prepaid Insurance 15,400.00 15,400.00
Office Equipment 261,800.00 300,000.00
Accumulated Depreciation 53,900.00 207,900.00 61,500.00 238,500.00
Total Assets ₱514,745.00 ₱651,990.00

Liabilities and Owner's Equity

Accounts Payable ₱53,900.00 ₱107,800.00
Salary Payable 9,240.00 9,240.00
Unearned Revenue 23,100.00 27,800.00
Total Liabilities ₱86,240.00 ₱144,840.00

B. Sia-Ko, Capital 428,505.00 507,150.00

Total Liabilities and Owner's Equity ₱514,745.00 ₱651,990.00

WENDY SERVICES INC

Income Statement
December 31
200A 200B
Revenue:
Service Revenue ₱600,000.00 ₱900,000.00
Expenses:
Equipment rental expense ₱200,000.00 ₱200,000.00
Wages expense ₱90,000.00 ₱90,000.00
Utilities expense ₱60,000.00 ₱60,000.00
Total expenses ₱350,000.00 ₱350,000.00
Net Income ₱250,000.00 ₱550,000.00

07 Activity 1 *Property of STI

Page 2 of 2