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Sevilla - Unit 2 - IA3
Sevilla - Unit 2 - IA3
PRETEST
1. D
2. A
3. C
4. D
5. C
ASSESSMENT
ACTIVITY 1
Answer as required:
1. TRIBULATION GREAT DISTRESS Co.’s current reporting period ends on December
31, 20x1. The following transactions occurred after the end of reporting period:
• On January 5, 20x2, TRIBULATION declared ₱8,000,000 dividends.
• On January 15, 20x2, TRIBULATION issued 1,000 shares with par value per share of
₱400 for ₱2,400 per share.
• On January 20, 20x2, TRIBULATION installed an oil rig. Current legislation requires
that the oil rig be uninstalled at the end of its useful life and the site where it was
installed be restored. TRIBULATION estimates the present value of the
decommissioning and restoration cost at ₱4,000,000.
• On February 1, 20x2, a building with a carrying amount as of December 31, 20x1 of
₱2,000,000 was totally razed by fire.
• On February 10, 20x2, TRIBULATION received notice of a litigation in relation to an
accident that happened on December 31, 20x1. TRIBULATION estimates a probable
loss of ₱800,000.
• On March 5, 20x2, TRIBULATION purchased a subsidiary for ₱40,000,000 in a
business combination accounted for using the acquisition method. Goodwill of
₱10,000,000 was recognized on the business combination.
The financial statements were authorized for issue on March 1, 20x2.
What is the total amount of the adjusting events?
P4,000,000 + P800,000 = P4,800,000
P400,000
3. The following relates to the transactions of GRIMACE FROWN Co. during 20x1:
Directors' and officers' remuneration 8,000,000
Post-employment benefits of officers 800,000
Fringe benefits in the form of housing assistance to
directors and officers 20,000,000
Share options granted to officers 1,200,000
Officers' expenses on travels, representation and
entertainment subject to liquidation and
reimbursement 400,000
Loans to directors and officers 12,000,000
Sales to related entities 40,000,000
1. How much is the amount of related party disclosures on GRIMACE’s separate
financial statements?
a. 30,000,000 b. 52,000,000 c. 82,000,000 d. 42,000,000
2. How much is the amount of related party disclosures on GRIMACE’s consolidated
financial statements?
a. 12,000,000 b. 30,000,000 c. 82,000,000 d. 42,000,000
PRETEST
1. C
2. B
3.D
4. D
5. C
ACTIVITY 2