Accounting 5- Quiz 1 Accumulated depreciation 73,000

Taxes payable 44,500

Problem 1: The general ledger summarized trial balance of H Corporation, a Bonds payable (net of discount of 10,000) 290,000
manufacturing company, includes the following accounts at December 31, Deferred income tax liability 68,000
2020: Share capital (10,000 shares, 1 par) 10,000
Accumulated Depreciation building - contra (120,000) Share premium 240,500
Accumulated depreciation- leased asset - contra (310,000) Total liabilities and equity 1,285,100
Accumulated depreciation- plant and equipment - contra (3,726,000) Compute the following:
Allowance for bad debt – contra current asset (80,000) a. Total current assets
Bank loans – Non current liab. (2,215,000) Cash 25,500
Bank overdrafts – current liab. (350,000) Investment Securities- Trading 62,000
Building, cost - non current asset 1,030,000 Inventories 624,000
Cash - current asset 175,000 Prepaid expenses 33,000
Current tax payable – current liability (152,000) Total 744,500
Debentures – 300k current liab. 375k non current liab. (675,000)
Deferred tax - NCL (420,000) b. Total assets
Deposits, at call - CA 36,000 Total current assets 744,500
Finished goods - CA 1,042,000 Investment securities 250,000
Goodwill - NCA 2,530,000 Property plant and equipment 280,000
Investment in listed companies AFS - NCA 52,000 Accumulated depreciation (73,000)
Goodwill 70,000
Investments revaluation reserves - equity (25,000)
Total 1,271,500
Land, at valuation - NCA 250,000
Land revaluation reserve - E (81,000)
c. Total current liabilities
Lease liabilities – 125k CL 225k NCL (350,000)
Notes payable 60,000
Leased assets - NCA 775,000 Accounts payable 227,000
Other loans - NCL (575,000) Taxes payable 44,500
Patents - NCA 110,000 Total 331,500
Plant and equipment - NCA 8,275,000
Prepayments - CA 141,000 d. Total equity
Provision for employment benefit – 192k CL, 83k NCL (275,000) Share capital 10,000
Provision for restructuring - CL (412,000) Share premium 240,500
Provision for warranty – 22k CL 20k NCL (42,000) Retained earnings 105,000
Raw materials - CA 490,000 Total 355,500
Retained earnings - E (1,481,000)
Share capital - E (3,500,000) Problem 3: T Company’s income statement for the year ended December 31,
Sundry creditors and accruals - CL (715,000) 2020 reported net profit of 10,000,000. The auditor raised questions about the
Sundry debtors - CA 320,000 following amounts that had been included in the net profit:
Trade creditors - CL (1,617,000) Unrealized loss on decline in value of available for sale 500,000
Trade debtors - CA 1,744,000 securities- OCI
Work in progress - CA 151,000 Loss on write-off of inventory due to government ban net of 100,000
Additional information: tax – P/l
a. Bank loans and other loans are all repayable beyond one year. Adjustment of profit of prior year net of tax - RE 2,000,000
b. 300,000 of the debentures is repayable within one year Loss from expropriation of property, net of tax – P/l 3,500,000
c. Lease liabilities include 125,000 repayable within one year Exchange differences gain on translating foreign operations - 4,500,000
d. Provision for employment benefits includes 192,000 payables within OCI
one year. Revaluation surplus realization - OCI 1,000,000
e. The planned restructuring is intended to be completed within one a. What is the company’s profit for the year 2020? 3,000,000
year. b. What is the company’s total comprehensive income for the year
f. Provision for warranty includes 20,000 estimated to be incurred 2020? 5,000,000
beyond one year.
Compute the following:
a. Total current asset = 4,019,000
b. Total non-current asset = 8,866,000
c. Total current liabilities = 3,885,000
d. Total non-current liabilities = 3,913,000

Problem 2: The following statement of financial position was prepared by

accountant for E Company as of 2020:
Assets:
Cash 25,500
Investment Securities- Trading (Includes long term investment 312,000
of 250,000 in shares of P Developers)
Inventories (Net of amount still due to suppliers of 85,000) 624,000
Prepaid expenses (includes a deposit of 10,000 made on 33,000
inventories to be delivered in 18 months)
Property, plant and equipment (excluding 60,000 of equipment 220,000
still in use, but fully depreciated)
Goodwill (based on estimate by the president of E Corporation) 70,000
Total assets 1,285,000
Liabilities and equity:
Notes payable (75,000 due in 2022) 135,000
Accounts payable (not including amount due to suppliers of 142,000
inventory)
Long-term liability under pension plan 60,000
Retained earnings restricted for building expansion 105,000