Updates in Philippine Accounting and Financial Reporting Standards

“Not intended for publication. For classroom instruction purposes only”.

Updates in Philippine Accounting and Financial Reporting Standards

Learning Activities

Name:
Class Schedule:

Directions: Read and analyze the following activity and answer what is required. Submit
your work in the pigeon boxes which are provided in your department/college, or to
google class on or before the date as reflected in your study schedule. See Rubrics in
appendix. You may also access the rubrics in the classwork section in the google
classroom.

Activity 1
Loving Care Company provided the following balances on December 21, 2021:
Franchise 200,000
Goods in process 600,000
Building 4,000,000
Employees income tax payable 20,000
Prepaid insurance 20,000
Raw materials 200,000
Notes payable 100,000
Cash 420,000
Accounts receivable 500,000
Retained earnings 880,000
Finished goods 400,000
Accrued Expenses 30,000
Trading securities 250,000
Claim receivable 20,000
Machinery 2,000,000
Advance from customer 100,000
Tools 40,000
Goodwill 100,000
Accumulated Depreciation-Machinery 1,300,000
Allowance for doubtful account 50,000

“Not intended for publication. For classroom instruction purposes only”.

Updates in Philippine Accounting and Financial Reporting Standards

Plant expansion fund 500,000

Serial bonds payable (500,000 due 2,500,000
every) July 31 of each year
Accounts payable 300,000
Share capital 5,000,000
Accumulated Depreciation-Building 1,600,000
Income tax payable 60,000
Factory supplies 50,000
Share premium 500,000
Accrued interest on notes payable 10,000
Investment in bonds 1,500,000
Land 1,500,000
Notes Receivable 150,000

Required:
Prepare a properly classified statement of financial position on December 31, 2021

Thank you for completing the task. If you have

not completed, or have difficulty in accomplishing the
activity, please send me a message to our google class
or you may ask clarifications through a text message or
phone calls on the contact number included in your
course guide.

And now, you are ready for the assessment.

Loving Care Company

Statement of Financial Position
As of December 31,2021

Assets

“Not intended for publication. For classroom instruction purposes only”.

Updates in Philippine Accounting and Financial Reporting Standards

Current Assets: Note

Cash 420,000
Trading Securities 250,000
Trade and Other Receivables (1) 620,000
Inventories (2) 1,250,000
Prepaid Insurance 20,000
Total Current Assets 2,560,000

Noncurrent Assets:
Property, Plant and Equipment (3) 4,640,000
Long-Term Investments (4) 2,000,000
Intangible Assets (5) 300,000
Total noncurrent assets 6,940,000
Total Assets 9,500,000

Liabilities and Shareholders' Equity

Current Liabilities:
Trade and Other Payables (6) 620,000
Serial Bonds Payable - current portion 500,000
Total Current Liabilities 1,120,000
Noncurrent Liabilities:
Serial Bonds Payable - remaining portion 2,000,000

Shareholders' Equity:
Share Capital 5,000,000
Share Premium 500,000
Retained Earnings 880,000
Total Shareholders' Equity 6,380,000
Total Liabilities and Shareholders' Equity 9,500,000

Note 1 - Trade and Other Receivables

Accounts Receivable 500,000
Allowance for doubtful accounts (50,000)
Notes Receivable 150,000
Claim Receivable 20,000
Total Trade and Other Receivables 620,000

Note 2 - Inventories
Finished Goods 400,000
Goods in Process 600,000
Raw Materials 200,000
Factory Supplies 50,000
Total Inventories 1,250,000

Note 3 - Property , Plant and Equipment

Cost Accumulated Depreciation Carrying Amount
Land 1,500,000 1,500,000
Building 4,000,000 1,600,000 2,400,000

“Not intended for publication. For classroom instruction purposes only”.

Updates in Philippine Accounting and Financial Reporting Standards

Machinery 2,000,000 1,300,000 700,000

Tools 40,000 40,000
Total 7,540,000 2,900,000 4,640,000

Note 4 - Long-Term Investments

Investment in Bonds 1,500,000
Plant Expansion Fund 500,000
Total 2,000,000

Note 5 - Intangible Assets

Franchise 200,000
Goodwill 100,000
Total 300,000

Note 6 - Trade and Other Payables

Accounts Payable 300,000
Notes Payable 100,000
Income Tax Payable 60,000
Advances from Customers 100,000
Accrued Expenses 30,000
Accrued Interest on note payable 10,000
Employees' income tax payable 20,000
Total Trade and Other Payables 620,000

“Not intended for publication. For classroom instruction purposes only”.