15. The Lucio Corporation presented the following balances from the historical peso income statement for theyear ended December 31, 2018:SalesP350,000Cost of goods soldDepreciation - buildingDepreciation - equipmentAll other expensesOther information include:218,00034,00023,00048,000• Merchandise available for sale came from 2017 inventory of P28,750 and 2018 purchases ofP220,000.Building costing P850,000 was acquired at the end of 2015.Equipment totalled P115,000, of which P85,000 was bought at the end of 2015 and P30,000 wasbought at the end of 2017.• The company uses the FIFO method of inventory valuation; average indexes for the year are used inrestating inventories.General price indexes at year end are as follows:2015 - 1002017 - 1062016 - 1022018 - 112(assume that all changes in the general price level index tool place more or less evenly during the year.)What should Lucio Corporation report as net income for the year ended December 31, 2018 restated forgeneral price-level changes?a. P16,512b. P22,852c. P22,016d. P21,431

Lucio corporation announced as per net income for year ended December 31,2018 for overall price…

Answered: ear ended December 31, 2018: Sales

Business

Accounting

ear ended December 31, 2018: Sales

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.

Question

15. The Lucio Corporation presented the following balances from the historical peso income statement for the
year ended December 31, 2018:
Sales
P350,000
Cost of goods sold
Depreciation - building
Depreciation - equipment
All other expenses
Other information include:
218,000
34,000
23,000
48,000
• Merchandise available for sale came from 2017 inventory of P28,750 and 2018 purchases of
P220,000.
Building costing P850,000 was acquired at the end of 2015.
Equipment totalled P115,000, of which P85,000 was bought at the end of 2015 and P30,000 was
bought at the end of 2017.
• The company uses the FIFO method of inventory valuation; average indexes for the year are used in
restating inventories.
General price indexes at year end are as follows:
2015 - 100
2017 - 106
2016 - 102
2018 - 112
(assume that all changes in the general price level index tool place more or less evenly during the year.)
What should Lucio Corporation report as net income for the year ended December 31, 2018 restated for
general price-level changes?
a. P16,512
b. P22,852
c. P22,016
d. P21,431

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