PROBLEM I The current asset section of the statement of financial position prepared by the accountant of II Company as of December 31, 2024 as follows: Current Assets: Cash Financial asset at fair value through profit or loss Accounts receivable Inventory Other current assets TOTAL CURRENT ASSETS 536,000 500,000 3,285,000 3,500,000 140,000 P7,961,000 The company determines its inventory at year-end by physical count. An examination of the accounts showed the following: a. On December 31, 2024, the company issued and recorded a check payable to a vendor dated January 15, 2025 in the amount of P80,000. b. The financial assets were purchased during the year 2024 for P500,000. Fair value at December 31 was P550,000. c. Accounts receivable includes selling price of goods invoiced to a customer on December 27, 2024. The goods cost P120,000 and were billed at 150% of cost. The goods were shipped FOB destination on December 27, 2024 and were received by the customer on January 5, 2025. d. There were goods out on consignment at sales price of P225,000. The company's gross profit on consigned goods is 40% of sales price. e. Other current assets represent the total cost of shares of II Company intended for resale in 2024 REQUIREMENT: Determine the correct amount of each current asset account.
PROBLEM I The current asset section of the statement of financial position prepared by the accountant of II Company as of December 31, 2024 as follows: Current Assets: Cash Financial asset at fair value through profit or loss Accounts receivable Inventory Other current assets TOTAL CURRENT ASSETS 536,000 500,000 3,285,000 3,500,000 140,000 P7,961,000 The company determines its inventory at year-end by physical count. An examination of the accounts showed the following: a. On December 31, 2024, the company issued and recorded a check payable to a vendor dated January 15, 2025 in the amount of P80,000. b. The financial assets were purchased during the year 2024 for P500,000. Fair value at December 31 was P550,000. c. Accounts receivable includes selling price of goods invoiced to a customer on December 27, 2024. The goods cost P120,000 and were billed at 150% of cost. The goods were shipped FOB destination on December 27, 2024 and were received by the customer on January 5, 2025. d. There were goods out on consignment at sales price of P225,000. The company's gross profit on consigned goods is 40% of sales price. e. Other current assets represent the total cost of shares of II Company intended for resale in 2024 REQUIREMENT: Determine the correct amount of each current asset account.
Cornerstones of Financial Accounting
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Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter7: Operating Assets
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Problem 68APSA: Financial Statement Presentation of Operating Assets Olympic Acquisitions Inc. prepared the...
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Transcribed Image Text:PROBLEM I
The current asset section of the statement of financial position prepared by the accountant of
II Company as of December 31, 2024 as follows:
Current Assets:
Cash
Financial asset at fair value through profit or loss
Accounts receivable
Inventory
Other current assets
TOTAL CURRENT ASSETS
536,000
500,000
3,285,000
3,500,000
140,000
P7,961,000
The company determines its inventory at year-end by physical count. An examination of the accounts
showed the following:
a. On December 31, 2024, the company issued and recorded a check payable to a vendor dated
January 15, 2025 in the amount of P80,000.
b. The financial assets were purchased during the year 2024 for P500,000. Fair value at December
31 was P550,000.
c. Accounts receivable includes selling price of goods invoiced to a customer on December 27,
2024. The goods cost P120,000 and were billed at 150% of cost. The goods were shipped
FOB destination on December 27, 2024 and were received by the customer on January 5,
2025.
d. There were goods out on consignment at sales price of P225,000. The company's gross profit
on consigned goods is 40% of sales price.
e. Other current assets represent the total cost of shares of II Company intended for resale in
2024
REQUIREMENT:
Determine the correct amount of each current asset account.
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