1. Cesar Vasquez, a businessman, has the following personal properties: Cash, P100,000 Land, P200,000; building, PI1,500,000 and car P500,000. He invested his cash and car i an eatery The other assets of the eatery were purchased and paid for using the investet cash: furniture and fixtures, P30,000; equipment, P60,000 and supplies, P5,000. Question: What accounting principle did you apply in recording the assets of the busines Required: List down the assets of the eatery.
1. Cesar Vasquez, a businessman, has the following personal properties: Cash, P100,000 Land, P200,000; building, PI1,500,000 and car P500,000. He invested his cash and car i an eatery The other assets of the eatery were purchased and paid for using the investet cash: furniture and fixtures, P30,000; equipment, P60,000 and supplies, P5,000. Question: What accounting principle did you apply in recording the assets of the busines Required: List down the assets of the eatery.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:1. Cesar Vasquez, a businessman, has the following personal properties: Cash, P100,000
Land, P200,000; building, P11,500,000 and car P500,000. He invested his cash and car in
an eatery The other assets of the eatery were purchased and paid for using the investet
cash: furniture and fixtures, P30,000; equipment, P60,000 and supplies, P5,000.
Question: What accounting principle did you apply in recording the assets of the business
Required: List down the assets of the eatery.
2. Refer to the first number, but assume that Mr. Vasquez invested the car and only one hal!
of his personal cash in the business.
Question: How much should he borrow to be able to buy the other assets and still have
PI0,000 cash to be used as working fund?
Required: Prepare a statement of financial position for the business.
3. Hunt is the President of Digital Printing with investors who gave capital money of
P10,000,000. You hired Wanda as auditor of the firm. The investors were dissatisfied with
the net income carned by the business. The business earned only P20,000 but this was
before accrued expenses of P100,000 were recorded. Actually, the business was losing
Hunt asked Wanda to approve the reports prepared by Gil, the accountant who was
ordered to delay the recording until after the investors` meeting. If you are Wanda, what
will you do? Does loyalty to Hunt hold you in his good esteem forever? Think of all the
consequences that will happen after this.
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