Drill on Operating Segment, Cash to Accrual and Single Entry JMF, CPA

Problem 1
Revlon Company has expanded rapidly and segment reporting is now required. The entity has no intersegment sales. The
following data are for the year ended December 31, 2019:
Operating segment Segment revenue Operating profit (loss) Identifiable assets
1 640,000 350,000 400,000
2 100,000 30,000 80,000
3 340,000 (70,000) 300,000
4 190,000 30,000 140,000
5 180,000 (250,000) 180,000
6 70,000 10,000 120,000
7 120,000 (30,000) 140,000
Others 380,000 25,000 140,000
 The “others” category includes five operating segments, none of which has revenue or assets greater then P80,000
and none with an operating profit
 Operating Segments 1 and 2 produce very similar products and use very similar production processes, but serve
different customer types and use quite different product distribution system. These differences are due in part to the
fact Segment 2 operates in a regulated environment while Segment 1 does not.
 Operating Segment 6 and 7 have very similar products, production processes, product distribution systems, but are
organized as separate divisions since they serve substantially different types of customer. Neither Segment 6 nor 7
operate in a regulated environment.
1. What are the reportable segments for the year ended December 31, 2019? Identify which quantitative thresholds each
segment has passed.
Problem 2
The following balances were reported by Mall Company on December 31:
12/31/2019 12/31/2018
Inventory 2,600,000 2,900,000
Accounts Payable 750,000 500,000
Mall paid suppliers 4,900,000 during the year ended December 31, 2019. Under Accrual basis, what amount should Mall report
for cost of ggods sold in 2019?
Problem 3
Under the accrual basis, rental income of Hamtikan Company for the current year is P600,000. Additional information
regarding rental income is as follows:
Unearned rental income, January 1 50,000
Unearned rental income, January 31 75,000
Accrued rental income, January 1 30,000
Accrued rental income, January 31 40,000
What total amount of cash was received from rental income in the current year?
Problem 4
Royal Company provided the following data for the current year:
Sales 10,000,000
Cost of Goods Sold 5,300,000
Operating Expenses 3,800,000
December 31 January 10, 2010
Prepaid Operating Expenses 1,000,000 700,000
Accounts Payable 1,350,000 1,200,000
Inventory 2,500,000 2,100,000
Accounts Receivable 1,400,000 1,375,000
Under cash basis, what amount should be reported as purchases for the current year?
Problem 5
Elaine Company experienced the following changes in selected accounts for the current year:
Accrual Sales 5,000,000
Accounts Receivable:
January 1 800,000
December 31 500,000
Advances from customers:
January 1 300,000
December 31 400,000
What total amount of cash was received from customers during the year?

End of Drill Mock Drill.