Martinez, Althea E.

September 22, 2021

BSAIS 1-A Activity #4

Socorro Company provided the following information on December 31, 2019:

Current assets 3,100,000 Current liabilities 1,000,000

Other assets 5,900,000 long term liabilities 1,000,000
Capital 7,000,000

Cash (including P200,000 invested in money market and

Restricted foreign deposit of P300,000) 1,000,000
Land held for undetermined use 500,000
Accounts receivable less allowance of P50,000 700,000
Inventories 600,000
Socorro Corporation share capital, at cost 300,000

Total current assets 3,100,000

Store supplies 50,000

Building less allowance of P500,000 3,000,000
Equipment less allowance of P250,000 750,000
Financial asset at amortized cost 1,000,000
Trademark 300,000
Advances to officers-indefinite repayment 150,000
Patent 250,000
Land 400,000

Total other assets 5,900,000

Accounts payable 500,000

Note payable, due December 31, 2020 100,000
Income tax payable 150,000
Share premium 250,000

Total current liabilities 1,000,000

Unearned leased hold income (five years starting 2020) 350,000
Stock dividend payable 150,000
Serial bonds payable (P100,000 maturing annually) 500,000

Total long-term liabilities 1,000,000

Retained earnings 1,500,000

Share capital,P100 par 5,000,000
Retained earnings appropriated for plant expansion 500,000

Total capital 7,000,000

Required:

Prepare statement of financial position with supporting notes and computations.

 Socorro Company

Statement of Financial Position

December 31, 2019

ASSETS

Current Assets: Note

Cash and Cash Equivalents (1) 700, 000

Trade and other Receivable (2) 700, 000

Inventories 600, 000

Prepaid Expenses (3) 50, 000

Total Current Assets P2, 050, 000

Non-current Assets:

Property, plants and equipment (4) 4, 150, 000

Long-term Investment (5) 1, 000, 000

Investment Property (6) 500, 000

Intangible Assets (7) 550, 000

Other non-current assets (8) 450, 000

Total non-current assets P6, 650, 000

Total Assets P8, 700, 000

EQUITY AND LIABILITIES

Current Liabilities:

Trade and other payables (9) 820, 000

Serial bonds payable-current portion 100, 000

Total Current Liabilities P920, 000

Non-current Liabilities:

Serial bond payable- remaining portion 400, 000

Unearned leasehold income remaining portion 280, 000

Total Non-current Liabilities P680, 000

Equity

Share Capital (10) 5, 150, 000

Reserves (11) 1, 050, 000

Retained Earnings (12) 1, 200, 000

Treasury share at cost (300, 000)

Total Equity P7, 100, 000

Total Liabilities and Equity P8, 700, 000

Note 1 – Cash and Cash Equivalent

Cash 500, 000

Money Market Placement 200, 000

Total P700, 000

Note 2 – Trade and other receivable

Accounts Receivable 750, 000

Allowance for doubtful accounts (50, 000)

Total Trade and other receivable P700, 000

Note 3 – Prepaid Expenses

Store Supplies P50, 000

Note 4 – Property, plant and equipment

Cost Accum.depr. Book Value

Land 400,000 - 400, 000

Building 3, 500, 000 500, 000 3, 000, 000

Equipment 1, 000, 000 250, 000 750, 000

Total P4, 900, 000 P750, 000 P4, 150, 000

Note 5 – Long Term Investment

Investment P1, 000, 000

Note 6 – Investment Property

Land for undetermined use P500, 000

Note 7 – Intangible Assets

Trademark 300, 000

Patent 250, 000

Total P550, 000

Note 8 – Other Non-current Assets

Advances to officers 150, 000

Restricted foreign deposit 300, 000

Total P450, 000

Note 9 – Trade and other Payables

Accounts Payable 500, 000

Notes Payable 100, 000

Income Tax Payable 150, 000

Unearned leasehold income current portion 70, 000

Total P820, 000

Note 10 – Common Stock

Stare Capital Issued 5, 000, 000

Stock dividend Payable 150, 000

Total P5, 150, 000

Note 11 – Reserves

Share Premium 250, 000

Retained earnings appropriate for plant expansion 500, 000

Retained earnings appropriate for treasury share 300, 000

Total Reserves P1, 050, 000

Note 12 – Retained Earnings

Retained Earnings Unappropriated 1, 500, 000

Appropration for treasury share (300, 000)

Adjusted Balance P1, 200, 000