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Problem - The board of directors of Calcium Company decided to embark on a substantial plant expansion. To demonstrate the need to retain assets in the entity, the board agreed on December 31, 2020 to authorize an appropriation of retained earnings in the amount of P5,000,000, the anticipated cost of plant expansion. The plant was partially constructed on December 31, 2021, and the board decided to reduce the appropriation by P3,000,000, the cost incurred to date. Finally, in July 2022, the plant was completed and the remaining portion of the appropriation was removed. Prepare journal entries to record, reduce and finally remove the appropriation.
Financial Statement Analysis and Preparation
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Computation of Free Cash Flow
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