Reference no: EM133100126
Question 1 - The cash account of Riyadh Corp. son December 31, 2024 has a balance of P127,600 and it consists of the following:
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Bills and coins on hand
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P52,780
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Petty cash including petty cash vouchers of P650
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1,000
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Balance in savings account with a bank closed by the BSP
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36,000
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Customer's check dated January 15, 2025
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8,000
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Credit memo from suppliers for purchases returns
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6,500
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Postage stamps
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120
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Money order
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800
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IOU of an employee
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400
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Checking account balance in Bank of P.I.
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22,000
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What the correct cash balance on December 31, 2024 of Riyadh Corp.?
a. P76,330
b. P76,580
c. P75,130
d. P75,930
Question 2 - On January 1, 2024, Contentious Company provided the following information related to the land and building:
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Land
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50,000,000
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Building
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450,000,000
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Accumulated depreciation-building
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75,000,000
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There were no additions or disposals during 2024. Depreciation is computed using straight line over 15 years for building. On June 30, 2024 the land and building were revalued as follows:
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Replacement cost
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Sound Value
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Land
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65,000,000
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65,000,000
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Building
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600,000,000
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480,000,000
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What is the depreciation of the building for the current year?
a. 30,000,000
b. 40,000,000
c. 32,000,000
d. 35,000,000
Question 3 - Jenerose Corp. has an outstanding 10% note payable dated October 1, 2020 and is payable in three equal annual payments of P600,000 plus interest. The first interest and principal payment was made on October 1, 2021. In Jenerose's June 30, 2022 statement of financial position, what amount should be reported as accrued interest payable for this note?
a. P135,000
b. P45,000
c. P90,000
d. P30,000
Question 4 - On February 1, 2021, Brian Corporation sold P300,000, 12 percent, ten-year bonds at 96 plus accrued interest. Interest is payable semi-annually on June 1 and December 1. The bond issue was dated December 1, 2020. On July 31, 2022, P150,000 of the issue was reacquired at 95 plus accrued interest. Assuming the entity uses the straight-line amortization method, the gain or loss on bond retirement to be recognized on July 31, 2022 is?
a. P2,500 gain
b. P2,415 gain
c. P2,669 loss
d. P2,669 gain
Question 5 - Beach Company acquired copyright to the original recordings of a famous singer. The agreement with the singer allows the entity to record and rerecord the singer for a period of 5 years. During the initial six-month period of the agreement, the singer is very sick and consequently cannot record. The studio time that was blocked by the entity had to be paid during the period the singer could not sing. The following cost are incurred by the entity:
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Cost of acquiring the copyright
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5,000,000
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Operating loss during the start-up period (studio time lost)
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1,000,000
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Massive advertising campaign to launch the artist
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1,500,000
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What amount should be capitalized as cost of the copyright?
a. 6,000,000
b. 5,000,000
c. 6,500,000
d. 7,500,000
Question 6 - Chameleon Company purchases a P4,000,000 tract of land for a factory site. The entity razed an old building on the property and sold the materials it salvaged from the demolition.
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Payments to tenants of old building to vacate the old building
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200,000
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Demolition of old building
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100,000
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Legal fee for purchase contract and recording title
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50,000
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Title guarantee insurance
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30,000
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roceeds from sale of salvaged materials
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10,000
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What is the initial carrying amount of land following the PIC interpretation?
a. 4,170,000
b. 4,080,000
c. 4,280,000
d. 4,030,000
Question 7 - Deuteronomy Corporation has a machine costing P480,000, with an annual depreciation of P96,000, and has accumulated depreciation of P240,000 on December 31, 2023. On April 1, 2024, when the machine has a fair value of P192,000, it is exchanged for a similar machine with a fair value of P576,000 and the proper amount of cash is paid. The loss to be recognized on exchange is
a. P0
b. P24,000
c. P48,000
d. P168,000
Question 7 - Collie Company and its subsidiaries own the following properties at year-end:
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Land held by Collie for undetermined use
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5,000,000
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A vacant building owned by Collie and to be leased out under an operating lease
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3,000,000
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Property held by a subsidiary of Collie, a real estate firm, in the ordinary course of business
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2,000,000
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Property held by Collie for use in production
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4,000,000
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Building owned by a subsidiary of Collie and for which the subsidiary provides maintenance services to the lessees
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1,500,000
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Land leased by Collie to a subsidiary under an operating lease
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2,500,000
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Property under construction for use as investment property
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6,000,000
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Land held for future factory site
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3,500,000
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Machinery leased out by Collie to an unrelated party under an operating lease
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1,000,000
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What total amount should be considered as owner-occupied property and included in property, plant and equipment in the consolidated statement of financial position?
a. 10,500,000
b. 13,000,000
c. 11,000,000
d. 8,500,000
Question 8 - Collie Company and its subsidiaries own the following properties at year-end:
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Land held by Collie for undetermined use
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5,000,000
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A vacant building owned by Collie and to be leased out under an operating lease
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3,000,000
|
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Property held by a subsidiary of Collie, a real estate firm, in the ordinary course of business
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2,000,000
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Property held by Collie for use in production
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4,000,000
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Building owned by a subsidiary of Collie and for which the subsidiary provides maintenance services to the lessees
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1,500,000
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Land leased by Collie to a subsidiary under an operating lease
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2,500,000
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Property under construction for use as investment property
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6,000,000
|
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Land held for future factory site
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3,500,000
|
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Machinery leased out by Collie to an unrelated party under an operating lease
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1,000,000
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What is the total investment property that should be reported in the consolidated statement of financial position of the parent and its subsidiaries?
a. 15,500,000
b. 10,500,000
c. 12,000,000
d. 9,500,000