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Masters Technological Institute of Mindanao

The document provides instructions and financial information for 5 problems related to accounting. It asks the student to identify: 1) The amount of financial instrument assets and liabilities based on trial balance information from Lucky Thirteen Company. 2) The classification of assets and liabilities as current vs non-current based on trial balance information from Handsome Licensed Albularyo Company. 3) The total liabilities based on trial balance information from Tenola Holmes, Inc. 4) The shareholders' equity based on trial balance information from The Great Escape Company. 5) The total shareholders' equity based on additional financial information provided for Right Here Telecommunications Inc.

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Pang Siulien
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© © All Rights Reserved
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Download as PDF, TXT or read online on Scribd
51 views

Masters Technological Institute of Mindanao

The document provides instructions and financial information for 5 problems related to accounting. It asks the student to identify: 1) The amount of financial instrument assets and liabilities based on trial balance information from Lucky Thirteen Company. 2) The classification of assets and liabilities as current vs non-current based on trial balance information from Handsome Licensed Albularyo Company. 3) The total liabilities based on trial balance information from Tenola Holmes, Inc. 4) The shareholders' equity based on trial balance information from The Great Escape Company. 5) The total shareholders' equity based on additional financial information provided for Right Here Telecommunications Inc.

Uploaded by

Pang Siulien
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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MASTERS TECHNOLOGICAL INSTITUTE OF MINDANAO

M. Badelles Sr. St., Cor. Actub St. Poblacion, Iligan City, 9200
Tel. No. (062) 228-2602/ (062) 21-6472
Email: [email protected]

ACCOUNTING 16
ACTIVITY 2

General Instruction: Provide solution for every item and then highlight your answer.

Financial or Non-Financial Instruments

P1. The relevant accounts and adjusted balances shown below were taken from Lucky Thirteen Company’s trial balance on December 31, 2019.

Cash deposit in banks 300,000 Finance lease payable 250,000


Gold bullion deposited in banks 2,000,000 Deferred revenue 120,000
Trade accounts receivable 1,400,000 Trade payables 650,000
Investment in debt instruments 3,000,000 Provision for estimated litigation loss 420,000
Investment in equity instruments 1,600,000 Issued debt instrument 1,800,000
Investment in equity instruments with 2,400,000 Issued equity instruments 2,900,000
significant influence
Prepaid expenses 120,000 Cash on hand 100,000

1. What total amount of financial instrument-assets that are within the scope of IAS 32 and IFRS 9 should Lucky Thirteen Company report for the year
2019?
2. What total amount of financial instrument-liabilities that are within the scope of IAS 32 and IFRS 9 should Lucky Thirteen Company report for the year
2019?
Assets, Liabilities and Classification (Current and Non-Current)

P2. The accounts and balances shown below were taken from Handsome Licensed Albularyo Company’s trial balance on December 31, 2019. All adjusting
entries were already made.
Wages Payable 250,000 Premium on Bonds Payable 48,000
Cash 175,000 Investment in Subsidiary 1,020,000
Bond Payable 600,000 Taxes Payable 228,000
Dividends Payable 140,000 Accounts Payable 248,000
Prepaid Rent 136,000 Accounts Receivable 366,000
Inventory 820,000 Property, Plant & Equipment 1,200,000
Investment in-Sinking Fund Assets 525,000 Patent 150,000
Investment in Profit or Loss Securities 153,000 Accumulated Depreciation-PPE 400,000
Land held for future business site 900,000 Permits and Licenses 50,000

3. How much should be reported in Handsome Licensed Albularyo’s December 31, 2019 statement of financial position as current assets?
4. How much should be reported in Handsome Licensed Albularyo’s December 31, 2019 statement of financial position as non-current assets?
5. How much should be reported in Handsome Licensed Albularyo’s December 31, 2019 statement of financial position as current liabilities?
6. How much should be reported in Handsome Licensed Albularyo’s December 31, 2019 statement of financial position as non-current liabilities?

Liabilities

P3. Tenola Holmes, Inc. reported the following items in its year ended December 31, 2019 trial balance:
Trademark 400,000
Discount on Bonds Payable 225,000
Bonds Payable 5,000,000
Cash Surrender Value of Officer’s Life Insurance 75,000
Estimated Liability Under Warranties 350,000
Unearned Rent Revenue 285,000
Advances to Employees 45,000
Accounts Payable 1,100,000
7. How much should Tenola Holmes, Inc. report as total liabilities in its year-end statement of financial position?
Shareholders’ Equity

P4. The Great Escape Company provided the following account balances after year-end adjustments on its December 31, 2019 trial balance.

Accrued Taxes 50,000 Mortgage payable (500,000 due in six 1,200,000


months)
Cash surrender value of life insurance 30,000 Shares Premium 250,000
Ordinary Share Capital 1,000,000 Preference Share Capital 450,000
Dividends payable-pref 150,000 Accumulated profits-Dec 31, 2019 550,000
Unearned rent income 25,000 Dividends payable-ordinary 100,000

8. How much should The Great Escape report as Shareholder’s Equity on December 31, 2014?

P5. For the year ended December 31, 2019, Right Here Telecommunications Inc. reported the following:

Net Income Php 600,000


Preference share capital dividends declared 50,000
Ordinary share capital dividend declared 20,000
Unrealized holdings loss, net of tax 10,000
Retained earnings, beg bal 800,000
Ordinary Share Capital 400,000
Preference Share Capital 200,000
Accumulated Other Comprehensive Income, beg bal, net of tax 50,000

9. What would Right Here Telecommunications Inc. report as total shareholders’ equity?

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