Best Friend's Co.

A.
{Inv. on hand + [Freight in x (Inv on hand/ Purchase)]}
{370000 + [320000 x (370000/ 7400000)]}

Inventory- End 386,000

Income Summary 386,000

B.
Ending Inventory 386,000
NRV (270,000)
Total 116,000

Loss on invetory 116,000

write-down
Inventory- End 116,000

C.
Bad debt expense 50,000
Allowance for bad debts 50,000

D.
Loss on reclassificat 200,000
Held for trading security 200,000

Held for trading secu 180,000

Unrealized gain 180,000

E.
Income tax expense 1,572,000
Income tax payable 1,572,000
 Best Friends Co.
Statement of profit or loss and other comprehensive income
For the year ended Dec. 31 20x1

Sales ₱22,800,000
Cost of Sales (9,664,000)
Gross Profit 13,136,000
Distribution costs 1,470,000
Administrative expenses (6,400,000)
Gain on impairment recovery of property plant and equipment (720,000)
Loss on inventory write- down (116,000)
Bad debt expense (50,000)
Reclassification on financial assets (200,000)
Unrealized gain on financial assets (180,000)
Finance costs (560,000)
Profit before tax 5,240,000
Income tax expense (1,572,000)
Profit of the year 3,668,000
Other comprehensive income
Items that will not be reclassifies subsequently
Revaluation increase during the period 130,000
Items that maybe reclassified subsequently to profit or loss
Other Comprehensive Income 130,000
TOTAL COMPREHENSIVE INCOME FOR THE YEAR ₱3,798,000
A.
Investment on bond 150000
Gain on derecognition

B.
Unrealized loss on biological asset 300000
Biological asset

C.
Investment in associate 46000
Dividends income 90000
Share in increase in profit of associate
Share in the revaluation increase

D.
Retirement benefits expense 588000
Remeasurement to the net defined benefit liability 252000
Defined benefit cost
150000

300000

100000
36000

840000
 Buddies Co.
Statement of profit or loss and other comprehensive income
For the year ended Dec. 31 20x1

Revenues from sevice fees ₱12,000,000

Cost of Sales (4,000,000)
Gross Profit 13,136,000
Salaries Expense (3,000,000)
Advertising Expense (680,000)
Gain on derecognition of investment in bonds (588,000)
Unrealized loss on biological asset (588,000)
Retirement benefit expense (588,000)
Profit before tax 7,692,000
Income tax expense (2,307,600)
Profit of the year 5,384,400
Other comprehensive income
Items that will not be reclassifies subsequently
Items that maybe reclassified subsequently to profit or loss
Remeasurement of net defined benefit liability 252,000
Other Comprehensive Income 252,000
TOTAL COMPREHENSIVE INCOME FOR THE YEAR ₱5,636,600
4. D
Operating loss (2,000,000.00)
Impairment loss (8M-1.5M) (1,500,000.00)

Total loss from discontinued

operations before taxes

(3,500,000.00)

5. D
Operating loss (200,000.00)
Loss on disposition of assets (700,000.00)

Total loss from discontinued

operations before taxes

(900,000.00)

6. A
Operation loss (1,000,000.00)
Impairment loss (400,000.00)

Total loss from discontinued

operations before taxes

(1,400,000.00)
 ABC Co.
Statement of Changes in Equity
For the year ended December 31,20x2
(amounts in Philippine Pesos)
Share Capital Retained Earnings
Balance, Jan. 1, 20x1 ₱ 1,000,000 ₱ 800,000
Changes in Equity for 20x1:
Profit for the year 720,000
Other comprehensive income
Total Comprehensive Income
Issue of Share Capital 400,000
Dividends (200,000)
Bal., Dec. 31,20x2 ₱ 1,400,000 ₱ 1,320,000
BC Co.
Changes in Equity
ed December 31,20x2
Philippine Pesos)
Unrealized gain FVOCI securities Total Equity
₱ 200,000 ₱ 2,000,000

720,000
(70,000) (70,000)
650,000
400,000
(200,000)
₱ 130,000 ₱ 2,850,000