Reference no: EM132623373

An analysis of Johnson, Inc. disclosed changes in account balances for 2017 and the following supplementary data.

Cash                                  P21,000 Increase

Accounts receivable             25,000 Increase

Inventory                          10,000 Decrease

Equipment                        70,000 Increase

Accounts payable                5,000 Decrease

Problem 1: Johnson sold 5,000 shares of its P5 par ordinary shares for P8 per share and received cash in full. Dividends of P15,000 were paid in cash during the year. Johnson borrowed P50,000 from the bank and made interest payments of P5,000. Johnson had no other loans payable. Interest of P1,000 was payable at December 31, 2017. There was no interest payable at December 31, 2016. Equipment of P20,000 was donated by shareholders during the year. From these data, compute the net income for 2017.