React Corporation Comparative Statements of Financial Position December 31, 2025 and 2024 2025 2024 Assets Current Assets Cash & Cash Equivalent 106,789 102,375 Trade & Other Receivables 327,611 277,467 Inventory 331,863 297,654 Prepaid Expenses 101,565 114,813 Total Current Assets 870,828 792,309 Noncurrent Assets Property, Plant & Equipment Intangibles 135,754 166,481 Total Noncurrent Assets 7,500 7,500 TOTAL ASSETS 143,254 173,981 1,014,082 966,290 Liabilities and Shareholders’ Equity Current Liabilities Trade & Other Payables Unearned Revenues 238,000 208,703 Notes Payables - current 107,508 82,456 Total Current Liabilities 45,000 45,000 Noncurrent Liabilities 390,508 336,159 Notes Payables - noncurrent Total Liabilities 208,422 253,500 Shareholders’ Equity 598,930 589,659 Preference Shares P100 ar Ordinary Shares, P1 par Premium on Ordinary Shares 105,000 105,000 Total Paid-in-Capital 15,000 15,000 135,000 135,000 Retained Earnings 255,000 255,000 Total Shareholders’ Equity TOTAL LIABILITIES & SHAREHOLDERS’ EQUITY 160,152 121,631 Total Share Equity 415,152 376,631 TOTAL LIABILITIES & SHAREHOLDERS’ EQUITY 1,014,082 966,290 React Corporation Comparative Income Statements For the period ending December 31, 2025 and 2024 2025 2024 Sales P 3,007,887 P 2,732,712 Less: Cost of good sold 2,208,520 1,964,805 Gross Profit 799,367 767,847 Less: Selling Expenses 372,000 345,000 Administrative Expenses 207,000 213,000 Total Operating Expenses 579,000 558,000 Operating Income 220,367 209,847 Less: Interest Expense 41,860 43,905 Net Income before Taxes 178,507 165,942 Less: Income Tax 62,477 58,080 Net Income after taxes P 116,030 P 107,862 Activity to do: Solve for the following; formula is being given to you. Support your answer by giving conclusion on your computation. What does it implies. Current Ratio = current assets/current liability Acid Test Ratio or Quick Ratio/Liquidity Ratio = Cash + Trading Securities + Receivables/Current Liabilities Accounts Receivable Turnover = Net Sales/ Average Accounts Receivable
React Corporation
Comparative
December 31, 2025 and 2024
|
|
2025 |
2024 |
|
Assets |
|
|
|
Current Assets |
|
|
|
Cash & Cash Equivalent |
106,789 |
102,375 |
|
Trade & Other Receivables |
327,611 |
277,467 |
|
Inventory |
331,863 |
297,654 |
|
Prepaid Expenses |
101,565 |
114,813 |
|
Total Current Assets |
870,828 |
792,309 |
|
Noncurrent Assets |
|
|
|
Property, Plant & Equipment |
|
|
|
Intangibles |
135,754 |
166,481 |
|
Total Noncurrent Assets |
7,500 |
7,500 |
|
TOTAL ASSETS |
143,254 |
173,981 |
|
|
1,014,082 |
966,290 |
|
Liabilities and Shareholders’ Equity |
|
|
|
Current Liabilities |
|
|
|
Trade & Other Payables |
|
|
|
Unearned Revenues |
238,000 |
208,703 |
|
Notes Payables - current |
107,508 |
82,456 |
|
Total Current Liabilities |
45,000 |
45,000 |
|
Noncurrent Liabilities |
390,508 |
336,159 |
|
Notes Payables - noncurrent |
|
|
|
Total Liabilities |
208,422 |
253,500 |
|
Shareholders’ Equity |
598,930 |
589,659 |
|
|
|
|
|
P100 ar |
|
|
|
Ordinary Shares, P1 par |
|
|
|
Premium on Ordinary Shares |
105,000 |
105,000 |
|
Total Paid-in-Capital |
15,000 |
15,000 |
|
|
135,000 |
135,000 |
|
|
255,000 |
255,000 |
|
Total Shareholders’ Equity |
|
|
|
TOTAL LIABILITIES & SHAREHOLDERS’ EQUITY |
160,152 |
121,631 |
|
Total Share Equity |
415,152 |
376,631 |
|
TOTAL LIABILITIES & SHAREHOLDERS’ EQUITY |
1,014,082 |
966,290 |
|
|
|
|
|
|
|
|
React Corporation
Comparative Income Statements
For the period ending December 31, 2025 and 2024
|
|
2025 |
2024 |
|
Sales |
P 3,007,887 |
P 2,732,712 |
|
Less: Cost of good sold |
2,208,520 |
1,964,805 |
|
Gross Profit |
799,367 |
767,847 |
|
Less: Selling Expenses |
372,000 |
345,000 |
|
Administrative Expenses |
207,000 |
213,000 |
|
Total Operating Expenses |
579,000 |
558,000 |
|
Operating Income |
220,367 |
209,847 |
|
Less: Interest Expense |
41,860 |
43,905 |
|
Net Income before Taxes |
178,507 |
165,942 |
|
Less: Income Tax |
62,477 |
58,080 |
|
Net Income after taxes |
P 116,030 |
P 107,862 |
Activity to do: Solve for the following; formula is being given to you. Support your answer by giving conclusion on your computation. What does it implies.
Current Ratio = current assets/current liability- Acid Test Ratio or Quick Ratio/
Liquidity Ratio = Cash + Trading Securities + Receivables/Current Liabilities Accounts Receivable Turnover = Net Sales/ Average Accounts Receivable- Days’ Sales in Average Receivables or Average Collection Period = 365 days/ Receivable turnover
- Inventory Turnover Ratio (Inventory turnover ratio pertains to the number of times the average inventory is sold ( finished goods and merchandise ), used ( raw materials ), or processed ( work-in-process) The following formulas are adapted depending on the nature of the inventory being assessed:
*Raw Materials Inventory Turnover = Raw Material Used/Average Raw Materials Inventory
*Work-in-Process Inventory Turnover = Cost of Goods Manufactured/Average Work in
Process Inventory
* Finished Goods Inventory Turnover = Cost of Goods Sold/Average Finished Goods Inventory
* Merchandise Inventory Turnover = Cost of Goods Sold/ Average Merchandise Inventory
* Average Inventory = Beginning Inventory + Ending Inventory / 2
In the problem I gave you choose which inventory are you going to solve.
- Property, Plant and Equipment (PPE) or Fixed Asset Turnover = Net Sales/Average Net PPE
- Total Asset Turnover = Net Sales/Average Total Assets
- Debt to Equity Ratio = Total Liabilities/Total
Stockholders’ Equity - Debt Ratio = Total Liabilities/Total Assets
- Number of Times Interest Earned = Net income before Interest and income tax or operating income/annual interest expense
- Gross Profit Ratio = Gross Profit/Net Sales
- Net Profit Ratio or Profit Margin = Net Profit/Net Sales
- Return on Assets (ROA) = Net Income/Average Total Assets
- Return on Equity = Net Income/Average stockholders’ equity
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