Reference no: EM132647029

The accounts below were taken from the unadjusted trial balance of Makati Company as at December 31, 2017:

Cash and Cash Equivalents - P1,240,000;

Trading Securities, at cost - P870,000;

Available for Sale Securities, P2,500,000;

Notes Receivable - P920,000;

Trade Accounts Receivable - P1,220,000;

Allowance for Bad Debts - P60,000;

Merchandise Inventory - P1,360,000;

Notes Payable - P1,500,000;

Trade Accounts Payable - P750,000;

Employees Income Tax Withheld - P40,000;

Bonds Payable - P2,500,000;

Share Dividends Distributable - P150,000;

Income Tax Payable - P280,000.

An analysis of the above accounts disclosed the following:

a. Included in Cash is a 120-day, P500,000, Certificate of Time Deposit dated September 17, 2017 and maturing on January 15, 2018.

b. Trade Accounts Receivable was net of customers' deposit of P70,000.

c. Merchandise worth P150,000 received December 30, 2017 was included in the inventory but was not recorded as a purchase.

d. Accounts Payable was net of accounts with debit balance of P120,000.

e. A bank loan of P300,000 due December 31, 2009 was included in the Notes Payable balance.

f. Bonds Payable, which was issued in 2017, will mature in five annual installments beginning June 1, 2018.

g. Trading Securities have a market value of P900,000 while Available for Sale Securities have market value of P2,420,000.

Required:

Problem 1: Determine the total current assets and total current liabilities of Makati Company at December 31, 2017.