Review Material

PROBLEM 1
2015 2016 2017 2018 2019
Beginning Capital 100,000 ? 380,000 400,000 350,000
Additional Investment ? 120,000 20,000 15,000 15,000
Net Income / (Net Loss) 150,000 75,000 ? ? ?
Withdrawals 50,000 25,000 35,000 0 35,000
Ending Capital ? ? 145,000

PROBLEM 2
Sales P 250,000 Purchase Discount P 13,500
Purchases ??? Cost of Goods Available for Sale 60,000
Freight-out 10,000 Inventory, Ending 20,000
Freight-in 5,000 Inventory, Beginning 40,000
Sales Discount 2,000 Lavern, Capital ???
Sales Returns 1,500 Lavern, Withdrawals 50,000
Purchase Returns and Allowances 12,500 Operating Expenses (including freight-out) 75,000
Interest Income 20,000 Interest Expense 10,500

Requirements:
a. Net Sales b. Net Purchase c. COGS d. Gross Profit e. Net Income
PROBLEM 3
Notes payable – 5 years 50,000 Inventory 6,000
Copyright 150,000 Accrued expenses 8,000
Accounts payable (60% is due 2 20,000 Accounts Receivable, net 70,000
years from now)
Brand name 140,000 Allowance for Doubtful accounts 2,500
Accumulated depreciation 10,000 Equipment , cost 55,000
Prepaid Insurance 58,500 Mortgage payable 220,000
Interest expense (10% is unpaid) 250,000 Notes Receivable 80,000
Utilities expense 5,000 Trademark 80,000
Cash 75,000 Cash equivalents 25,000
Requirements:
a. Current Assets b. Non-Current Assets c. Current Liabilities d. Non-Current Liabilities e. Capital

PROBLEM 4
Lave Company provided the following information for the year-ended December 31, 2018:
A. The company has a Inventory ending of P100,000. Included in this amount are P20,000 goods out on consignment and P10,000 goods held on consignment.
B. The company received an advance payment of P48,000 for a 2-year delivery. The company started delivering March 31, 2017.
C. An office equipment costing P450,000 has a useful life of 4 years with a scrap value of P50,000. The office equipment was acquired April 1 of last year.
D. The Company invested P360,000 on a bond certificate that paid 2% annual interest. The bond was acquired in Aug. 31 of the current year and carried a 1-year term of
maturity.
Requirements:
a. Inventory b. Unearned Revenue c. Net Book Value d. Interest Receivable

PROBLEM 5
Savings account – BPI 100,000 Bills and coins 20,000
Current account – BDO 70,000 Post-dated check 5,000
Customer’s check dated 1/20/19 80,000 Time deposit 27,000
Money market placement 20,000 Traveller’s check 40,000
Compensating balance 1,000 Foreign currency $ 900
Treasury bill (90 days) 15,000
Add’l info:
a. P20,000 of the BPI savings account balance was invested to Time Deposit which matures after 91 days. Requirements
b. Current exchange rate is P40 per dollar. a. Cash on Hand
c. 10% of the foreign currency is restricted. b. Cash in Bank
d. The compensating balance is restricted as to withdrawal. c. Cash Equivalents
d. Receivable