THE FOLLOWING DATA WERE TAKEN FROM THE INCOMPLETE ACCOUNTING RECORDS MAINTAINED BY FERN COMPANY,

A SOLE PROPRIETORSHIP ENGAGE IN MERCHANDISING BUSINESS.

12/31/2021

Cash 890,000.00
Notes Receivable 600,000.00
Accounts Receivable 1,000,000.00
Merchandise Inventory 500,000.00
Equipment 550,000.00
Notes Payable 250,000.00
Accounts Payable 500,000.00
Accrued Interest payable 20,000.00
Unearned Rent Income 20,000.00

The cashbook showed the following information:

Balance ,January 1

RECEIPTS
Accounts Receivables ₱1,500,000.00
Notes Receivable 500,000.00
Cash sales 400,000.00
Rent Income 80,000.00
Sale of equipment costing ₱100,000.00
Carrying value 50,000.00 60,000.00
Investment 300,000.00
Total

PAYMENTS
Accounts Payable ₱750,000.00
Notes Payable 650,000.00
Cash Purchases 300,000.00
Interest expense 50,000.00
Expenses 400,000.00
Equipment 200,000.00
Withdrawals 200,000.00

Balance ,January 31

SUPPLEMENTARY INFORMATION:
Sales discounts granted to customers 50,000.00
Sales returns made by customers 150,000.00
Accounts receivable written off as uncollectible 30,000.00
Purchase discounts on accounts payable paid 40,000.00

Requirements:
1) COMPUTE FOR THE SALES
2) COMPUTE FOR THE COST OF SALES
3)COMPUTE FOR OTHER INCOME
4)DEPRECIATION EXPENSE
5) INTEREST EXPENSE
6) COMPUTE FOR THE PROFIT USINGTHE TRANSACTION APPROACH
7) COMPUTE FOR THE PROFIT USING THE CAPITAL MAINTAINANCE APPROACH

Note: Please be mindful of your format. Presentation matters.

Honor Pledge
“I accept responsibility for my role in ensuring the integrity of the work submitted by the group in which I participated.”

Attendance in the Conference, Date/Time: March 2, 2022 March 4, 2022

9:50A.M - 10:30A.M 9:25AM - 10:30A.M
Leader: Berondo, Farhana Aliezah S. Present Present
Members:
1. Coca, Nicole B. Absent Present
2. Ronato, Joy Marie Present Present
3. Santos, Czarina Julienne Z. Present Present
MPANY,

12/31/2020

600,000.00
200,000.00
800,000.00
800,000.00
600,000.00
350,000.00
600,000.00
40,000.00
60,000.00

₱600,000.00

2,840,000.00
₱3,440,000.00

2,550,000.00

₱890,000.00
participated.”
SALES

GROSS SALES
Cash Sales P
Credit Sales
Notes Receivable, end P 600,000.00
Collections on Accounts receivable 1,500,000.00
Collections on Notes receivable 500,000.00
Accounts receivable, end 1,000,000.00
Accounts receivable written off 30,000.00
Sales returns and allowances 150,000.00
Sales discounts taken by customers 50,000.00
Total P 3,830,000.00
Less: Accounts receivable, beg. (800,000.00)
Notes Receivable, beg. (200,000.00)
Gross Sales P

NET SALES
Total Gross Sales P 3,230,000.00
Less: Sales Return & Allowances (150,000.00)
Sales Discount (50,000.00)
Net Sales P 3,030,000.00
 400,000.00

2,830,000.00
3,230,000.00
PURCHASES

GROSS PURCHASES
Payments on notes payable during the year ₱650,000.00
Payments on accounts payable during the year 750,000.00
Notes Payable, end ₱250,000.00
Accounts Payable, end 500,000.00
Purchases Discount Taken 40,000.00
Purchases Returns and Allowances -
Cash Purchases 300,000.00
Total ₱1,090,000.00
Less: Notes payable, beg (350,000.00)
Accounts Payable, beg (600,000.00) 140,000.00
Gross Purchases ₱1,540,000.00

NET PURCHASES
Gross Purchases 1,540,000.00
Less: Purchase Return and Allowances -
Purchase Discount (40,000.00)
Net Purchases ₱1,500,000.00
COST OF SALES

COST OF SALES
Inventory, beg. ₱800,000.00
Purchases ₱1,540,000.00
Less: Purchase discounts (40,000.00)
Purchase returns and allowances - 1,500,000.00
Cost of Goods available for sale ₱2,300,000.00
- Inventory, end (500,000.00)
Cost of Sales ₱1,800,000.00
OTHER INCOME
OTHER REVENUES
(Ex. Interest / Rent Revenue)
Cash receipts for interest/rent P 80,000.00
Add: revenue earned during the
Unearned rent, beg P 60,000.00 year but collected/to be collected in
Interest receivable, end - 60,000.00 another year
Less: revenue received in cash
Less: Unearned rent, end (20,000.00) during the year but earned /will be
Interest receivable, beg. - (20,000.00) earned in another year
Interest/Rent Revenue P 120,000.00
DEPRECIATION EXPENSE

NON-CASH OPERATING EXPENSES

(PPE net of accumulated depreciation)
Property, Plant and Equipment (net), Beginning ₱600,000.00
Less: Property, Plant and Equipment (net), Ending (550,000.00)
Increase (Decrease) ₱50,000.00
Add: Cost of Newly Acquired Asset 200,000.00
Less: Carrying Value of Asset Disposed (50,000.00)
Depreciation Expense for the Year ₱200,000.00
INTEREST EXPENSE

INTEREST EXPENSE
Cash payment this year ₱50,000.00
Add: Accrued Interest, end 20,000.00
Total ₱70,000.00
Less: Accrued Interest, beg (40,000.00)
Interest Expense ₱30,000.00
NET PROFIT - TRANSACTION APPROACH

FERN Company
STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 12/31/2021

NET SALES SCHED 1 ₱3,030,000.00

LESS: COST OF SALES SCHED 2 1,800,000.00
GROSS PROFIT ₱1,230,000.00
ADD: OTHER INCOME SCHED 3 130,000.00
TOTAL INCOME ₱1,360,000.00
LESS:
EXPENSES ₱400,000.00
DEPRECIATION EXPENSE SCHED 4 200,000.00
BAD DEBTS EXPENSE 30,000.00
INTEREST EXPENSE SCHED 5 30,000.00 ₱660,000.00
NET INCOME ₱700,000.00

SCHEDULES:
SCHED 1
Total Gross ₱3,230,000.00
Less: Sales Return & Allowances (150,000.00)
Sales Discount (50,000) (200,000)
Net Sales ₱3,030,000.00
SCHED 2
Inventory, beg. ₱800,000.00
Purchases ₱1,540,000.00
Less: Purchase discounts (40,000) 1,500,000
Cost of Goods available for sale ₱2,300,000.00
Less: Inventory, end (500,000)
Cost of Goods Sold ₱1,800,000.00

SCHED 3
Cash Receipts 2021 ₱80,000.00
Add: Unearned rent, beg 60,000.00
Less: Unearned rent, end (20,000.00)
Other Income (Rent) ₱120,000.00
Carrying Value 60,000.00
(50,000.00)
Gain on Sale 10,000
Total Other income 130,000

SCHED 4
Property, Plant and Equipment (net), Beg. ₱600,000.00
Property, Plant and Equipment (net), End 550,000
Increase (Decrease) ₱50,000.00
Add: Cost of Newly Acquired Asset 200,000
Less: Carrying Value of Asset Disposed (50,000)
Depreciation ₱200,000.00
SCHED 5
Cash payment during 2021 ₱50,000.00
Add: Accrued Interest, end. 20,000
Total ₱70,000.00
Less: Accrued Interest, beg. (40,000)
Interest Expense ₱30,000.00
NET PROFIT - CAPITAL MAINTENANCE APPROACH

12/31/2021 12/31/2020

Cash P 890,000.00 P 600,000.00

Accounts Receivable 1,000,000.00 800,000.00
Notes Receivable 600,000.00 200,000.00
Merchandise Inventory 500,000.00 800,000.00
Equipment 550,000.00 600,000.00
TOTAL ASSETS ₱3,540,000.00 ₱3,000,000.00

Accounts Payable P 500,000.00 P 600,000.00

Notes Payable 250,000.00 350,000.00
Accrued Interest Payable 20,000.00 40,000.00
Unearned Rent Income 20,000.00 60,000.00
TOTAL LIABILITIES ₱790,000.00 ₱1,050,000.00

TOTAL ASSETS P 3,540,000.00 P 3,000,000.00

LESS: TOTAL LIABILITIES 790,000.00 1,050,000.00
EQUITY ₱2,750,000.00 ₱1,950,000.00

EQUITY, END P 2,750,000.00

EQUITY, BEG 1,950,000.00
TOTAL INCREASE (DECREASE ) IN EQUITY ₱800,000.00
ADD: DRAWINGS 200,000.00
LESS: INVESTMENT (300,000.00)
NET INCOME ₱700,000.00