Answered: If total assets decreased by P47,000…

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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Question

If total assets decreased by P47,000 during a period of time and owner’s equity increased by P 24,000 during the same period, the amount and direction, increase or decrease, of the period’s change in total liabilities is _____________. Put a parenthesis if your answer indicates a decrease

On November 2020, Guess Company advanced P120,000 for services to be rendered on the first quarter of 2021. The liability method was used to record the collection of said amount. What amount is recognized as revenue for the year 2020?

On January 1, 2021, the beginning balance of Armani Company (VAT registered) inventory amounted to P600,000. On January 15, 2021, Armani Company purchased P952,000 (VAT inclusive) worth of inventory with terms 2/15 n/60. On January 25, Armani Company returned 10% of defective inventories and paid the rest on January 29, 2021. At the end of the accounting period, inventory on hand amounted to P450,000.
How much will recorded as credit to Purchase returns and allowances?

Eternity Company had the following data for the period ended. Cash sales P400,000; credit sales 70% of cash sales; sales discounts P25,000; sales returns P20,000; freight in P15,000; freight out P16,000. The company would report net sales on its income statement of __________.

Cash paid to a supplier for merchandise purchased on account was credited for P5,800 and the Accounts Receivable was debited for the same amount. The actual amount paid was P8,500. If not corrected, the balance of the Accounts Payable would have been overstated (understated) by how much? Place a parenthesis if understated.

Merchandise with an invoice price of P3,000 is purchased on September 2 subject to terms of 2/10, n/30, FOB destination. Freight costs paid by the seller totaled P200. What is the amount of payment if the invoice is paid on September 12? Ignore VAT

CPA Company bought P105,000 of furniture. Accumulated Depreciation has a balance of P30,000 prior to recording of current year’s depreciation. Depreciation expense at the end of the year isP7,000. What is the book value of the furniture at the end of the year?

If total assets increased by P175,000 during a specific period and liabilities decreased by P10,000 during the same period, the period’s change in total owner’s equity was a P 185,000 increase.

On January 1, 2020, Montblanc Company’s Allowance for Bad debts had a credit balance of P120,000. During the year, the company wrote off P205,000 of uncollectible accounts receivable, and unexpectedly recovered P65,000 of bad debts written off in the prior year. Also at the end of the year, the company charged P260,000 to bad debts expense. How much is the adjusted balance of Allowance for Bad debts on December 31, 2020?

On December 3, 2020, Estee Company purchased merchandise from Lauder Company amounting to P 30,000 (12% VAT exclusive). Terms 2/10, n/30, FOB shipping point, freight collect. Amount of freight cost is P 1,000. Both companies are vat registered and uses the periodic inventory system. Assuming Lauder Company issued a credit memorandum for P 5,600 (Vat inclusive), and Estee paid the amount due within the discount period, the amount of Output tax on the cash discount will be _________.

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