REVIEW DAY

BUSINESS FINANCE
 Prayer
Lord,
Father of all, We ask for Your help as we begin our lesson.
Allow us to experience Your presence in the many blessings
You put before us.
Open our heart and mind to new learnings.
Give us a generous spirit,
to my learners to be enthusiastic
with their studies and courage
to accept new opportunities .
Help them to be attentive in my class and
we are praying for a good internet connection Lord.
In Jesus name we pray, Amen.
Income Statement

Required: Determine the following

1. Net Sales
2. Cost of Goods Sold
3. Operating Expenses
4. Tax Expense
5. Net Profit
Income Statement

Required: Determine the following

1. Net Sales
Php 9,140,000
1. Cost of Goods Sold
Php 5,330,000
1. Operating Expenses
Php 3,335,000
1. Tax Expense
Php 142,500
1. Net Profit
Php 332,500
 Shareholders’ Equity
Ordinary Share, P20 par, 30,000 shares
authorized, 18,000 shares issued
Preference Shares, P25 par, 20,000 shares
authorized, 10,000 shares issued
Share Premium - Ordinary Share
Share Premium - Preferred Share
Retained Earnings
Treasury Share, 3,500 shares, at cost of
15/share
Required: Determine the following
1. Number of authorized ordinary shares.
₱ 360,000 2. Number of unissued ordinary shares.
3. Number of issued preference shares
4. Number of treasury shares.
₱ 250,000 6. Number of outstanding shares.
7. Total Peso Treasury Shares
₱ 90,000 8. Total Peso under Share Capital
9. Total Share Capital and Retained Earnings
10. Total Shareholders’ Equity.
₱ 50,000
₱ 520,000
?
 Shareholders’ Equity Required: Determine the following
1. Number of authorized ordinary shares
30,000 shares
2. Number of unissued ordinary shares
Ordinary Share, P20 par, 30,000 shares 12,000 shares
authorized, 18,000 shares issued ₱ 360,000 3. Number of issued preference shares
10,000 shares
Preference Shares, P25 par, 20,000 shares 4. Number of treasury shares
authorized, 10,000 shares issued ₱ 250,000 3,500 shares
6. Number of outstanding shares
Share Premium - Ordinary Share ₱ 90,000 24,500 shares
7. Total Peso Treasury Shares
Php 52,500
Share Premium - Preferred Share ₱ 50,000
8. Total Peso under Share Capital
Php 750,000
Retained Earnings ₱ 520,000 9. Total Share Capital and Retained Earnings
Treasury Share, 3,500 shares, at cost of Php 1,270,000
15/share ? 10. Total Shareholders’ Equity.
Php 1,217,500
EQUITY
1. SHARE CAPITAL
a. COMMON STOCK/ORDINARY SHARES
b. PREFERENCE SHARES
c. SUBSCRIBED SHARES (net of subscription receivable not collectible currently)
d. ADDITIONAL PAID-IN CAPITAL/SHARE PREMIUM
i. SP-OS
ii. SP-PS
iii. SP-SS
2. RETAINED EARNINGS
a. APPROPRIATED
b. UNAPPROPRIATED
3. TREASURY SHARES - DEDUCTED TO YOUR TOTAL SHE
Balance Sheet
Required: Determine the following
1. Current Assets
2. Non-current Assets
3. Current Liabilities
4. Non-Current Liabilities
5. Equity
Balance Sheet Required: Determine the following
1. Current Assets
Php 104,000
1. Non-current Assets
Php 86,200
1. Current Liabilities
Php 36,800
1. Non-Current Liabilities
Php 32,000
1. Equity
Php 121,400
 Back
Cash Flow Statement
 CASH FLOW
Dusik Corporation provided the following data for the
preparation of the Statement of Cash Flows for the
current year:
Decrease in Accounts Receivable 20,500 Use the data above to compute the following.
Increase in Inventory 34,440
Gain on sale of equipment 44,243 1. Using the Indirect method how much
should be reported as cash flow from
Increase in Accounts Payable 52,550
operating activities?
Depreciation Expense 105,000
2. How much should be reported as cash
Loss on sale of building 155,788 flow from investing activities?
Net Income 125,232 3. How much should be reported as cash
Proceeds from old equipment 482,156 flow from financing activities?
Payment of Cash Dividends 200,428
Purchase new equipment 50,088
Payment of Bonds Payable 100,090
Decrease in Salaries Payable 50,400
Issuance of Common Stock 30,870
 CASH FLOW
Dusik Corporation provided the following data for the Use the data above to compute the following.
preparation of the Statement of Cash Flows for the
current year:
1. Using the Indirect method how much
should be reported as cash flow from
Decrease in Accounts Receivable 20,500
operating activities? 588, 153
Increase in Inventory 34,440
Gain on sale of equipment 44,243
Increase in Accounts Payable 52,550 1. How much should be reported as cash flow
Depreciation Expense 105,000 from investing activities? 432,068
Loss on sale of building 155,788
Net Income 125,232 1. How much should be reported as cash flow
Proceeds from old equipment 482,156 from financing activities? -269,648
Payment of Cash Dividends 200,428
Purchase new equipment 50,088
Payment of Bonds Payable 100,090
Decrease in Salaries Payable 50,400
Issuance of Common Stock 30,870
 Financial Ratios
The following information pertains to Bangtan Corporation. Assume
that all balance sheet amounts represent both average and ending
balance figures. Assume that all sales were on credit.

Assets
Cash and short-term investments ₱ 80,000
Accounts receivable (net) ₱ 50,000
Inventory ₱ 40,000
Property, plant and equipment ₱ 420,000
Total Assets ₱ 590,000
REQUIRED:
Liabilities and Stockholders’ Equity
Current liabilities ₱ 120,000
A. CURRENT RATIO
Long-term liabilities ₱ 170,000 B. RECEIVABLES TURNOVER
Stockholders’ equity—common ₱ 300,000
Total Liabilities and Stockholders’ Equity ₱ 590,000 C. INVENTORY TURNOVER
Income Statement
D. RETURN ON ASSETS
Sales ₱ 170,000 E. GROSS PROFIT RATIO
Cost of goods sold ₱ 90,000
Gross margin ₱ 80,000
Operating expenses ₱ 40,000
Net income ₱ 40,000
 Financial Ratios
A Current assets 80,000 + 50,0000 + 40,000
Current liabilities 120,000
Assets
₱ 170,000
Cash and short-term investments ₱ 80,000 Current Ratio =
₱ 120,000
Accounts receivable (net) ₱ 50,000
Inventory ₱ 40,000
Current Ratio = 1.42
Property, plant and equipment ₱ 420,000
Total Assets ₱ 590,000 B Net sales ₱ 170,000
Average AR ₱ 25,000
Liabilities and Stockholders’ Equity AR Turnover = 6.80x
Current liabilities ₱ 120,000
Long-term liabilities ₱ 170,000 C COGS ₱ 90,000
Stockholders’ equity—common ₱ 300,000 Ave Inventory ₱ 20,000
Total Liabilities and Stockholders’ Equity ₱ 590,000 Inventory Turnover = 4.50x

Income Statement D Net Income ₱ 40,000

Sales ₱ 170,000 Total Assets ₱ 590,000
Cost of goods sold ₱ 90,000 Return on Assets = 6.78% or .07
Gross Profit ₱ 80,000
Operating expenses ₱ 40,000 E Gross Profit ₱ 80,000
Net income ₱ 40,000 Sales ₱ 170,000
Gross Profit Ratio = 47.06% or .47