NO SOLUTIONS, NO POINTS

NO ERASURES ON FINAL ANSWERS

FINAL ANSWERS MUST BE ENCLOSED IN A BOX

PROBLEM 1 SUMMARY 35
PROBLEM 1 SOLUTION 21
PROBLEM 2 Jes 60
PROBLEM 2 WORKSHEET 116
GRAND TOTAL 232

5 pts. Each
a
Current Non-current
1. Bonds Payable 70,000 3,966,000
2. Notes Payable 1,290,000 1,800,000
b 3,538,000
c 5,766,000
d 9,304,000

TOTAL 35
GINA COOL
(a) Give the current and noncurrent portion of the following liabilities:

Bonds Payable POINTS

Answer:
Accrued interest (4M*7%*3/12) 70,000
Carrying amount 1/1/10 (4M*98%) 3,920,000 2
Add: Discount amortization (80,000/120*69) 46,000 2
Bonds – Noncurrent 3,966,000

Notes Payable
Answer:
4/1/2016 100,000
7/1/2016 200,000
10/1/2016 100,000
1/1/2017 200,000
4/1/2016 – 3/31/2017 600,000
Unpaid Interest 90,000
Total current 1,290,000

4/1/2017 – 3/31/2018 400,000

4/1/2018 – 3/31/2019 400,000
4/1/2019 – 3/31/2020 500,000
4/1/2020 – 3/31/2021 500,000
Total noncurrent 1,800,000

(b) How much is the total current liabilities?

Answer:

Warranties:
Estimated warranty 55,000
Total warranty expense 145,000
Actual Repair (130,000)
Total 70,000 3

Trade Payables:
Accounts Payable 325,000 2

Payroll:
Accrued salaries and wages 145,000
Income taxes withheld from employees 45,000
Other payroll deductions 3,000
193,000 3

Taxes:
Income taxes 255,000
Property taxes 100,000
Value-added taxes 185,000
540,000 3

Other accruals:
Accrued items 50,000 2

Dividends:
Number of shares issued and outstanding 2,000,000
Number of shares subscribed 500,000
Total 2,500,000 2
Multiply by cash dividend per share 0.4
Dividend payable 1,000,000 2

Warranties 70,000
Accounts Payable 325,000
Payroll 193,000
Taxes 540,000
Other Accruals 50,000
Dividend Payable 1,000,000
Notes Payable – current 1,290,000
Bonds Payable – current 70,000
Total current liabilities 3,538,000

(c) How much is the total noncurrent liabilities?

Answer:

Bonds Payable – noncurrent 3,966,000

Notes Payable – current 1,800,000
Total noncurrent liabilities 5,766,000

(d) How much is the total liabilities of the company?

Answer:

Total current liabilities 3,538,000

Total noncurrent liabilities 5,766,000
Total liabilities 9,304,000

TOTAL 21
JOURNAL ENTRIES - TIMOTHY T. CO

2016
3-Jan Cash (100,000 x 1,000/2,000) 50,000.00
Subscription Receivable 50,000.00

Subscribed Ordinary Share Capital (1,000 x 100) 100,000.00

Ordinary share capital 100,000.00

10-Jan Cash (1,000 x 125) 125,000.00

Donated Capital 125,000.00

Donated Capital (legal and brokerage fees) 10,000.00

Cash 10,000.00

15-Jan Issued 15,000 rights to purchase 1 ordinary share for every 10 rights at par value

1-Mar Cash (8,000/10 = 800 shares x 100) 80,000.00

Ordinary share capital 80,000.00

7,000 warrants have expired

Cash (7,000/10 = 700 shares x 118) 82,600.00

Ordinary share capital 70,000.00
Share premium-issuance 12,600.00

15-Mar Ordinary share capital (1,000 x 100) 100,000.00

Share premium-issuance (1,000 x 10) 10,000.00
Retained earnings 120,000.00
Treasury ordinary shares 230,000.00

1-Apr Retained earnings 198,000.00

(15,500 + 1,000 x 10% x 120)
Ordinary share capital 165,000.00
Share premium-ordinary 33,000.00

20-Apr Issued 8,575 ordinary new shares with a P200 par value as a result of 2 for 1 reverse stock split.
(16500 x 110% = 18,150-1,000 = 17,150 / 2)

30-Jun Preference share capital (2,000 x 100) 200,000.00

Share premium (2,000 x 20) 40,000.00
Retained earnings 40,000.00
Cash (2,000 x 140) 280,000.00
(160,000 / 8000 = 20)
 Retained earnings 125,000.00
Cash dividends payable 125,000.00
(200,000 x 10% x 6.25)
125,000.00
Cash dividends payable 125,000.00
Cash

1-Oct

Computation: 0.15
Preference shares Ordinary shares
Number of shares outstanding 5,000.00 9,075.00
Dividends in arrears
(5000 shares x 100 x 10% x 6.5 years) 325,000.00

Dividends-ordinary (9075 x 30) 272,250.00

Participation of preference shares
(500,000 x .15) 75,000.00
Total 400,000.00 272,250.00

500,000.00
Proof: Total Dividends Preference shares
672,250.00
Dividends in arrears (325,000.00) 325,000.00
Dividends ordinary shares (10% x 1,617,000) (161,700.00)
Balance for participation 185,550.00
Preference shares (500,000 x 15%) (75,000.00) 75,000.00
Ordinary shares (155,850 - 75,000) (96,600.00)
13,950.00 400,000.00

Retained earnings 400,000.00

Cash 400,000.00

Retained earnings 272,250.00

Cash 272,250.00

31-Dec Retained earnings appropriated for treasury shares 230,000.00

Retained earnings 230,000.00

Income Summary 500,000.00

Retained Earnings 500,000.00
2011 1
2012 1
2013 1
2014 1
2015 1

2016 1
2016 0.25 3 months from April 1 to June 30
6.25 dividends in arrears

0.25 From July to October 1 2016

6.5 dividends in arrears

0.15 Ordinary dividend rate

POINTS

1
1

1
1

1
1

1
1

1
1

1
1
1

1
1
1
1

1
1
1
1

1
1
1
1
 1
1

1
1

1
672,250.00 3

1,617,000.00 2,117,000.00
Ordinary shares

1
161,700.00 1
1
1
110,550.00 1
272,250.00 672,250.00 4

1
1

1
1

1
1

1
1
hs from April 1 to June 30
ds in arrears 1

y to October 1 2016 1
1

dividend rate (30/200) 1

TOTAL 60
COMPREHENSIVE PROBLEM ON SHAREHOLDERS' EQUITY USING SPREADSHEET

SHARES ENTITLED TO DIVIDENDS

ISSUED SHARES NOT ALL
SUBSCRIBED SHARES YES
DELINQUENT SHARES YES
TREASURY SHARES NO

NORMAL COMPUTATION:
OUTSTANDING SHARES = ISSUED SHARES - TREASURY SHARES

OUTSTANDING SHARES FOR DIVIDENDS:

OUTSTANDING SHARES = ISSUED SHARES - TREASURY SHARES + SUBSCRIBED SHARES + DELINQUENT SHARES

NOTE: REFER TO SECTION 71 AND 72 of the CORPORATION CODE

Treasury
Date Particulars Issued Acquired
1/1/2016 Beginning Balance 8,000 1,000
3-Jan 1,000 Subscribed ordinary shares fully paid
10-Jan 1,000 Donated ordinary shares resissued @125
net of 10,000 brokerage fee
15-Jan Issued 15,000 warrants to ordinary shares
(14,000 + 1,000 Subscribed)
1-Mar 8,000 Ordinary shares warrants were exercised

Shares covered by 7,000 expired

warrants were sold @118

15-Mar 1000 Ordinary shares-treasury shares, retired

1-Apr 10% stock dividends on ordinary shares, fair value @ 120

20-Apr 2 for 1 reverse split on ordinary shares

(new par value - 200.00)

30-Jun 2,000 PS were called (2,000)

Payment of dividends to call date

1-Oct Cash dividends ordinary shares shall get P30.00

per share

31-Dec Net income for the year

Adjustment of appropriatrion -treasury shares
Total 6,000 1,000

Shareholders' Equity : For BVPS

Preference share capital 600,000.00 600,000.00
Ordinary shares capital 1,715,000.00 1,715,000.00
Subscribed ordinary share capital 100,000.00 100,000.00
Subscription Receivable (50,000.00)
Share Premium:
Preference 120,000.00 120,000.00
Ordinary 290,600.00 290,600.00
Retained Earnings:
Appropriated 140,000.00 140,000.00
Unappropriated 474,750.00 474,750.00
Treasury shares (140,000.00) (140,000.00)
Total 3,250,350.00 3,300,350.00

Book Value per share

Preference
Issued 6,000.00 600,000.00
Subscribed
Total 6,000.00 600,000.00
Less: Treasury shares 1,000.00 100,000.00
Outstanding shares 5,000.00 500,000.00

PS capital (1000x100) 100,000.00

Share premium -PS 40,000.00
TS-PS 140,000.00

Excess over par:

Share premium:
Preference 80,000.00
Ordinary 290,600.00 370,600.00
Retained earnings:
Appropriated 140,000.00
Unappropriated 474,750.00
Total 985,350.00
 Excess over par PS
985,350.00 500,000.00
Liquidation premium (30 x 5,000) (150,000.00) 150,000.00
Unpaid dividends (3 months) (12,500.00) 12,500.00
Ordinary shares (10% x 1,732,000) (181,500.00)
Balance for participation 641,350.00
Preference shares (5000/33143 x 746600) 96,754.97
Ordinary shares
Total 759,254.97
BVPS 151.85
SHARES + DELINQUENT SHARES + SHARE DIVIDENDS DISTRIBUTABLE

10% PS, cum./fully participating, 10,000 shares authorized

Treasury Normal Subscribed
Donated Outstanding shares Par value Shares Par value
7,000 800,000.00

5,000 (200,000.00)
 5,000 600,000.00

2,825,600.00

50,000.00

Ordinary
8,575.00 1,715,000.00
500.00 100,000.00
9,075.00 1,815,000.00

9,075.00 1,815,000.00
 OS Total
1,815,000.00 3,300,350.00

181,500.00

544,595.03
2,541,095.03 3,300,350.00
280.01
es authorized
Subscribed
Subscription receivable Share Premium-preference Treasury shares at cost Issued
160,000.00 140,000.00 14,000
1,000

800

700

(1,000)

1,650

8,575

(40,000.00)
 120,000.00 140,000.00 8,575

2.00
2.00
2.00
1.00

2.00
2.00

2.00
2.00
2.00
2.00

3,250,350.00
(50,000.00)
 Ordinary Share Capital, P100 par, 20,000 shares authorized
Treasury Normal Subscribed
Acquired Donated Outstanding shares Par value Shares Par value
1,000 1,000 12,000 1,400,000.00 2,000.00 200,000.00
13,000 100,000.00 (1,000.00) (100,000.00)
1,000.00
(1,000) 14,000

14,800 80,000.00

15,500 70,000.00

(1,000) 15,500 (100,000.00)

17,150 165,000.00

8,575 500.00
8,575.00 1,715,000.00 500.00 100,000.00
horized Retained Earningd POINTS
Subscribed
S-Receivable Share Premium TS at cost Appropriated Unappropriated
100,000.00 140,000.00 230,000.00 370,000.00 900,000.00 18
(50,000.00) 6
1
115,000.00 3

12,600.00 4

(10,000.00) (230,000.00) (120,000.00) 7

33,000.00 (198,000.00) 5

(40,000.00) 5
(125,000.00) 1

(672,250.00) 1

500,000.00 1
 (230,000.00) 230,000.00 2
50,000.00 290,600.00 - 140,000.00 474,750.00 18

4
2

2
4

1
1
1

1
2

1
1
1
 4
2
2
2
1
1
3

2
TOTAL 116