Particulars Jan. 1, 2021 Jul.

15, 2021
Cash 415,150
Accounts Receivable 273,350
Inventory 285,750
Property, plant and equipment 1,600,250
Collections from customers, January 1, 2021 to July 15, 2021 1,507,600
Estimated Sales from January 1, 2021 to July 15, 2021 1,504,200
Estimated Purchases from January 1, 2021 to July 15, 2021 1,022,450
Payment to suppliers, January 1, 2021 to July 15, 2021 975,000
Accounts Payable 245,550
Goods out of consignment on July 15, 2021, at cost 97,500
Goods in transit at July 15, 2021, FOB shipping point* 34,750
Long-term payable 700,000

*included in the July 15 accounts payable balance

2017 2018
Sales 1,252,000 1,410,000
Gross profit 375,600 366,600

GPR 30% 26%

Average GPR [(30% + 26% + 34%) / 3] 30%

Invty, adj 255,260

Goods out of consigment (97,500)
Goods in transit (34,750)
Inventory fire loss 123,010 Q3

Answers
1 2,494,410.00
2 339,400.00
3 123,010.00
4 1,455,010.00
5 363,752.50
 AR, unadj. 273,350.00
Collection 1,507,600.00
Unrecorded collection 500.00
Sales (1,504,200.00)
AR, adj 277,250.00

Invty, unadj. 285,750.00

Purchases 1,022,450.00
COGS ** (1,052,940.00)
Invty, adj 255,260.00

Sales 1,504,200.00
(1-Ave. GPR) 70%
COGS 1,052,940.00

Cash 415,150.00
AR 277,250.00
2019 Invty 255,260.00
1,360,000 PPE 1,536,750.00 (cost-adjustment)
462,400.00 Prepayment 10,000.00
Q1 Total Asset 2,494,410.00
34%
AP, unadj, 245,550.00
Purchases 1,022,450.00
Payment (975,000.00)
Overstatement in Pay't 950.00
AP, adj 293,950.00

AP 293,950.00
Accrual 30,150.00
Payroll 15,300.00
Q2 Current liabilities 339,400.00
Long-term payable 700,000.00
Total Liabilities 1,039,400.00

Total Asset 2,494,410.00

Total Liabilities (1,039,400.00)
Q4 SHE 1,455,010.00
% 25%
Q5 Unapprop. RE 363,752.50
ost-adjustment)
Total Asset 4,900,550 Ordinary share 100,000 Adj. # 2
Current Liabilites 750,000 2,600,000 Adj. # 3
Non-current liabilities 1,270,000 2,700,000
SHE 2,880,550

Adj. 2
Cash (20x10k sh) 200,000 SP 100,000 Adj. # 2
OS (10x10k) 100,000 1,800,000 Adj. # 3
sp 100,000 1,900,000

Adj. 3
Buildings 1,500,000
Land 2,900,000
OS (10x260k) 2,600,000
sp 1,800,000

Est. warrantly liab, beg 937,500 750,000 (187,500)

Expense 850,000 -25.00%
Cost (1,055,550) 937,500
Est. warrantly liab, end 731,950 Q4

Carrying Value 1,570,000

Tax base 1,850,000 Answers
Difference 280,000 1 7,480,550
% 25% 2 -
DTL 70,000 Q5 3 4,600,000
4 731,950
5 70,000
Asset
Unadjusted 4,900,550
Cash 200,000 Adj. # 2 4,600,000 Q3
Bldgs 1,500,000 Adj. # 3
Land 2,900,000 Adj. # 3
Adjusted 9,500,550

SHE
Unadjusted 2,880,550
OS 2,700,000
SP-OS 1,900,000
Total SHE 7,480,550 Q1

Liabilities, adj 2,020,000

Liabilities, unadj 2,020,000
Adjustment - Q2