Jnald Co. made available the folowing infomation relative to its defined benefit obligation plan for the year 2048: Benefit obligation, January 1, P4.500,000; Fair value of plan assets, January 1, P5,000,000; Curent service cost, P1,700,000; Discount rate, 10%; Benefit paid to ‘efirees, Pi,000,000; Contribution to the plan, P1,200,000; Actual return on pian asses, 600,000; Net actuarial gain due to remeasurement of benefit obigation, P200,000; Past service cost due to amendment ofthe beneft pan, P300,000 Jonald Co’ beneft obigation at December 31, 2018 is. ‘AL P5,200,000 ©. P5,750,000 B. P5\650,000 . P5.340,000 ‘Alexander Co. commenced construction of 2 new plant on March 1, 2018. The cost of 36,000,000 was paid in full 1o the contractor on March 1, 2018 and was funded from the ing general borrowings. The construction was completed on October 31, 2018. The ‘borrowing during 2018 comprised of the folowing: PhilTrust Bank at 634, PB,000,000; Union Bank at 6%, P10,000,000; Metrobank at 9%, P30,000,000, ‘Te amounts that Alexander Co. should recognize as borrowing cost to be capitalized in relation to the plant and the amount of interest expense for 2018, respectively, shal be, ‘A. PO and P3,980,000 1,990,080 and P1,989.920 B,_ 1,989,920 and P1 990,080 3,960,000 and PO Esmeralda Co. provide the folowing information Physical inventory, at cost PF 200,000 Sales Cost of sales ‘Accounts receivable, trade 4,700,000 ‘Accounis payable, trade 1,900, In 2018, accounts written off amounted to P120,000. Sales returns with crect memo amounted to 150,000 and purchases returns, P80,000. Cash receipts from customers after P220,000 siscounts totaled P7,900,000 while cash payments to trade creitors amounted to P5,500,000 after siscounts of P300,000. Cash paid to customers for good retumed P100,000 which was debited to ‘accounts receivable, ‘The amount that Esmeralda Co. should report as gross sales for 2018 under the accrual basisis A 8,420,000 c. P8.490,000 8. P6.370,000 D. P6,590,000, ‘The amount that Esmeralda Co. should report as gross purchases for 2018 under the accrual basisis| ‘A P5 500,000 c. 6,000,000 8. P5,760,000 . P6,080,000 Information on the inventory of Gespar Co. Cost, P12.0; Estimated seling price, P13.60; Estimated disposal cost, P20; Normal gross margin, P22; Replacement cost, P1090 Under the lower of cost or net realizable value rule, the measurement the inventory item of Gaspar Co. shouldbe at A. P1070 c. Pt1.20 B, P1090 D. P1200In June 2018, Nangkil Co. determined that actual costs incured associated with the equipment used in its assembly ine signfcanty exceeded original expected costs. At June 30, 2018, the ‘company compiled the folowing information: ‘Original cost ofthe equipment, P1,600,000; Accumulated depreciation, P6QO,000; Expected net future cash inflows (undiscounted) reated to the continued use and eventual disposal of the equiament, P900,000; Fair vaive ofthe equipment, P750 000. ‘The amount of impaiment loss that should be reported on the income statement of Nangkil Co, for the period ended June 20, 2018 is, A. P100,000. c. P700,000 B. P250,000 D. P750,000 Theame Co. uses the revaluation model for intangible assets. On March 1, 2017, it acquired intangible assets with an indefinite life for P300,000. On December 31, 2017, it wes determined that the recoverable amount for these intangible assets was P270,000. On December 31, 2018, twas determined that the intangible assets had a recoverable amount of 282,000. ‘The impairment gain or loss to be recognized by Theame Co. on the intangible asses in the 2017 and 2018 income statement shal be A D. 207 PO PSH0OoToss _PAD,OOO oss _P30,D00 Toss 2018 PO PO 2,000, 18,000 gain ‘On July 1, 2018, Alberto Co. has an equipment wth a cost of P5O0,000 and accumulated depreciation of P'375,000. On that date the company classified the equipment as held fr sale ‘and decided to sell it within one year. On this same date, the equipment had an estimated ‘seling price of P50,000 and a remaining useful fe of 2 years, It's estimated that seling cost ‘associated with the disposal equipment wll be P5,000. On December 31, 2018, the estimated seling price of the equipment had increased to P75,000 with estimated saling cost of 10,000. The amount to be recognized by Alberto Co. as gain on reversal of impairment at December 31, 2018is. A 20,000 . P36875 B P20.000 D. P46.875 Hervesus Co, hed outstanding on December 31, 2018, 10%, 5,000,000 face value convertible bonds maturing on December 31,2021. Interest is payable annually on December 31, each P1,000 bond is convertible info 50 shares of Harvesus’ P20 par value ordinary shares. The unamorized premium balance on December 31, 2018 is P128,000. The paid in capital arising from bond conversion prviege account has a balance of P100,000. On December 31, 2018, an individual holding 500 ofthe bonds exercised the conversion privilege when the market price of Hervesus’ ordinary shares was P30 each Under IAS 22, Harvesus Co.'s enty to record the conversion should include a credit to share prem of A Po ©. Pize00 B. P1000 D. P2280 ‘Montreal Co, had 100,000 of 15 par value-ordinary shares on January 1, 2018. During 2018, the following transactions pertaining tits ordinary shares occurred. Purchased 5,000 shares as treasury at P30 each. ‘The ordinary share was spit fort Reissued 4,000 treasury shares at P16 eachMontel Co's ol cost of he remsining Leesa shares end the numberof cutstaning shares et December 3, 201, espectvely shal be A. P110,000 and P285,000 C. 330,000 and P285,000. 8. 110.000 and 299.000 0. 7390.00 ana P2900 Jericho Co. issued on January 1, 2017 share appreciation rights to its president exercisable for ane year begining January 1, 2019 provided thatthe president i stl in the emplay ofthe ‘company at that date of exercise. Each right provides for a cash payment equal to the excess ‘of the company’s share price over P50. The equivalent number of shares for share appreciation hs willbe based on te lve ofthe compan a the date of exercise asfolows: Level of sales 200,000,000 to P500,000,000 Over 500,000,000, Equivalent shares granted 42,000 15,000 ‘Actual sales achieved by Jericho and the share price atthe end of each year are as follows: 2017 2018 Sales 330,000,000, 520,000,000, ‘Share price PB P95 Jericho Co's compensation expense recognized in the accounts for the year ended December 31,2017 is A PO c. P228,000 B. P190,000 D. 285,000 Jericho Co's compensation expense recognized in the accounts for the year ended December 31,2018 i. ‘A. 226,000 c. P4a7.000 B Pdg7.500 D. 675,000 Thidie Co. started business in 2017. t sells printer with a three-year waranty. Thitie estimates its waranty cost as a percentage of peso sales. Based on past experience itis estimated that 3% wil be repaired during te fist year of waranty, 5% wl be repaired during the second year of warranty and 10% wil be in the third yeer. In 2017 and 2018, the company’ was able to sell 8,000 and 9,000 unis, respectvly ata seling price of P4.000 per unit. The company aio incurred actual repair cost of P650,000 and 1,500,000 in 2017 and 2018, respectively. Sales and repair our eveny throughout the perio. ‘The amount of lability for warranty to be reported in thie Co's December 31, 2018 statement offnancial positon and the predicted warranty expense covering 2017 and 2018 sales sill under warranty at December 31, 2018, respectively, sll be ‘A. P10,486,000 and P10,666 000 C._P11 856,000 and P12,816,000 BegPIOgD50OendPI0469000 ————D._P 12815 000 and PI 856000 Victoria Co. issues on December 31, 2016, 20-year bonds of P5,000,000 for P5,851,160 to yield 10%, inerest is payable annually on December 31 at 11%. On June 30, 2048, Vietora rebres 2,000 of its own P1000 bonds at 96% plus accrued interest. The accounting period of ‘Victorias the calendar year. The company uses the effective intrest method of amortzation, Victoria Co.'s gain or oss onthe retirement of bonds is. ‘A. 80,000 gain .P400,097 gain B. P80.000 loss D. P400,097 loss ‘The carrying amount of Victoria Co.'s remaining bonds at December 31, 2016 is ‘A. 3,000,000 C. P3489,626 B. P3470.663, D. P5,000.000Bemadette Co. records its purchases at gross amount but wishes to change to recording purchases net of purchase discounts. Discounts available on purchases recorded from October 1, 2017 to September 30, 2018, foaled P10,000. OF this amount P1,000 is stil availble in the accounts payable balance. The balances in Bernadett's aocounts as of and for the year ended September 30, 2018, before conversion are: Purchases, PS00,000; Purchase discount taken, P4,000; Account payable, P150,000 Bernadette Co’s enity to record conversion in the recording of purchases from the gross to the net method shall include the following EXCEPT. ‘A. Debit to purchase of P10,000 B. Debit to account payable of P1,000 C. Debit to purchase discount of 4,000 D. Debit to purchase ciscount loss of 5,000 Benshaw Co. regularly buys shit from Davis Co. and is allowed trade discount of 20% and 410% from the ist price. Benshaw purchased shirts from David on Apri 11, 2018 and received an invoice wth ist price amount of P50,000 and payment terms of 2/10, n/30, Benshaw uses the net method to record purchases. On July 1, 2018, Dormer Co. purchased @ new machine on a deferred payment basis. A down ‘payment of P100,000 was made and 4 monthly installments of P250,000 each are to be made beginning August 1, 2018. The cash equivalent price ofthe machine was PESO 000. Dermer incured and paid instalaton cost amounting to P30,000, ‘In 2018, Josefe Co. incurred the following costs related to @ new solar-powered car: Salaries of laboratory employoes researching how di o uid he new car. P0000: Legal fees for the patent application for the new car, P40,000; Engineering follow-up during the early ‘stages of commercial production (the follow-up occurred during 2018), P100,000; Marketing research lo promote the new ca, P6D,000; Design, testing and constuction of a prottype, ‘P 800,000. Privade Co. is engaged in raising dairy livestock. Data provided in 2018 flows: Carrying amount in January, P2 500,000; Increase due to purchases, P*,000,000; Gain atising from change in fair value less cost of disposal atbutable to price change, P200,000; Gain atising from change in fair value less cost of disposal atinbutable to physical , 'P300,000; Decrease due to sales, P400,000; Decrease due to harvest, P100,000. Benshaw Co. should record the purchases from Davis Co. a A. P34.300 C. P35,280 B. P35,000 D. P36,000 ‘The amount to be capitalized by Dormer as the cost of the machine is. ‘A. 950,000 . Pt,100,000 B. P980,000 D. 1,130,000 “The amount that should be reported by Josefe Co. as research and development expanse in the 2018 income statements, ‘A. 500,000 c. P1,440,000 8. P1,300,000 D. 1,500,000 ‘The canying amount of the biological assets of Privado Co. on December 31, 2018 is ‘A P3,000,000 ©. 4,000,000 8. P3.500,000 . P4400,000The information provided by the Guiyan Corp. with respect tothe cash and cash equivalent at December 31, 2018 follows: Checking account at Bank of Asia (overdrat), 510,000; Checking account at Steting Bank, 2,000,000; Employee's postdated check, 120,000; Foreign bank account which is unrestricted end in equivalent peso, P2.500,000; 1OU from the company president, PSO0 000; Money order, P160,000; NSF Customer check, P100,000; Payroll account, P8O0,000; Petty ‘cash fund comprising P25,000 in currency and expenses receipts for P50,000, P7500; Postage stamps, P10,000; Trvele’s check, P300,000: Treasury bonds, P1,500,000; Value ‘added tax account, 600,000, ‘The correct amount to be reported by Guiyan Corp, as unrestricted cash on December 31, 2018s. ‘A. 6,085,000 C. P6585,000 B. P6285,000 D. P6.635.000 6,385,000 Included inthe bank reconciliation of Denver Corp. on December 31, 2018 were the folowing (Creat memo for November recorded in December, P60,000; Credit memo for December nt yet recorded, P80,000; Deposit in transit at December 31, 2018, P100,000; Erroneous bank Charge in December corrected by bank in December, P8,000; Erraneous reat by the ‘company during December where no correction was made untl the following year, P10,000; ‘Total company receigts for December, P850,000; Total crecit per bank in December, 800,000, Denver Corps amount of deposit in transit at November 30,2018. A 32,000 c, P42,000 B. P40,000 DL P50,000 ‘Adeipha Corp. sells various merchandlse both for cash and on credit. Accounts receivable ‘transaction during 2018 fllons: ‘Accounts written off [s worthless, P6,400; Cash received from cash customers, 206,200; ‘Cash received from credit customers where PZ31,000 was received from credit customer who took the advantage of the 4% discount within the discount period, 330,000, Credit memoranda issued to credit customers for sales retums and allowances, P26,400; Cash refunds given to cash customers for sales retums and allowances, P17,100, Recovers on ‘accounts witten off 3s uncollectible in prior periods which are not yet incuded in the above collectons, P6,800; Sales for cash and cre, P791,000. The December 31, 2017 statement of nancial positon balances for account receivable and ‘allowance for bad debis are P85,800 and 7,900, respectively. An aging of the receivables indicates that P15,500 ofthe account receivable balance are deemed uncolectbe.. ‘Adelpha Corps balance of accounts receivable that would be shown in the December 31, 2018 statement of financial positon and the bad debts expense to be reported in profit o oss for the year ended December 31, 2018, respectively, shall be ‘A. 296,175 and P7,200 (©. P304,575 and P7.800 B, P298,175 and P15,500 D._P304,575 and P8, 300 Redentor Corp. purchased for P108,000, on July 2, 2018, 2,000 shares of Paula Corp's newly issued 6% cumulative P20 par value preference share capital, Each share also had one stock warrant attached, which enfited the holder to acquire, at P19, one share of Paula P10 par value ordinary share capital for each two warrants held. The market price, on tis date, of the preference share capital without warrants) was P5Q per share and the market price ofthe stocks warrants wes P10 per warrants. On September 2, 2018, all the stock warrants were sold for 19,800Redentor Corp's gain on sale ofthe stock warrants is. A PO B. PROD ‘The following notes payable, issued by Square Co., were outstanding during the entice ‘construction ofan assets that qualified fr interest capitazaton 8,000,000 notes payable bearing interest at 10% 10,000,000 notes payable bearing interest at 5.5% None of the borrowing were specified forthe construction ofthe qualified asset. (On June 1, 2018, Dreamer Co. entered into 2 realestate lease agreement for 2 new buiding. “The lease isan operating lease and is fuly executed on that day. According tothe ters of the lease, payments of P30,000 per month are scheduie to begin on October 1, 2018 and to ‘continue each month thereafter for 86 months. The lease term spans fve years. Dreamer has ‘calendar year-end Millenial Co. incurred on March 1. 2018, an apparenty permanent inventory loss from market cdecine in the amount of P600,000, ‘The folowing information pertains to Manaoag Co. and its operating segments forthe year ‘ended December 31, 2018: Tolal revenues 100,000,000 Sales to external customers (rncluing in total) 20,000,000 ‘The interest rate that should be used by Square Co, to calculate capitalized intrest onthe constuction is A 55% C. 7.75% 375% D. 10% Dreamer Co's ease expense for 2018 A Paso00 . P96 000 B. P90,000 D. P210,000 ‘The amount of inventory loss that should be recognized by Mifenial Co. in is quarterly income siatement for the 3 months ended March 31, 2018 is, A P150,000 c. Pé00,000 8 P200,000 DL P600,000 External revenue reported by Manaoag Co's reportable segments must atleast be ‘AL P60,000 ¢ P20,000,0000 & P15,000,000 . 40,000,000 (On December 5, 2018, Manchester Co, established a petty cash fund of P20,000, On December 31, 2018, the petly cash fund was examined and found out to have receipts and documents for miscellaneous expenses amounting to P18,200. In addition there was cash ‘amounting o P2,200. Nonway Co. uses the net price method of accountng for cash discount. In one of is transaction on December 5, 2018, Nomay sold merchandise witha list price of P1,000,000 to 2 clan who was given a trade discount of 20%, 10% and 5%. Credit tems given by Nonway were 410,130. The goeds were shipped FOB destinaton, freight collect. Toa fight charge paid by the ent wes P25,000. On December 10,2016, the cent retumed damaged ooods onginal bid at P100 000The entty that would be required by Manchester Co, on December 31, 2018 to record the ‘replenishment ofthe petty cash fund is_ A. Petty cash 18,200 Cash 17,800 Cash short and Over 400 8. Miscelleneous Expense 18200 Cash 17800 Cash shot end Over 400 CC. Miscellaneous Expense 17,800 Cash shor and Over 400 Cash 18.200 The net realizable value of Norway's accounts receivable at December 31, 2018 is A 536,640 . 624,000 B. P559,000 D. 650,000 ‘Ben Hur Co. entered on March 15, 2018 into a fim commitment to purchase on May 31, 2018 ‘a machinery from Osaka Co. for 100,000,000 yen. The exchange rate on March 15 is 100yen = 1USD. Ben Hur paid 10,000USD fora call option contract in order to reduce the exchange rate risk that could increase the cost of the machinery in USD. The contract gave Ben Hur the ‘option to purchase 100,000,000yen at an exchange rate of 100yen=1USD on May 31. The ‘exchange rate on May 31 is 9Syen = 1USD Glorietta Co. acquired atthe beginning of 2018 nontracing equity instrument for PS,000,000 with transaction cost of P550,000 and irevocably designated as financial asset at fair value through other comprehensive income. The fair value was P6,200,000 at December 31 and the transaction cost that would be incurred on the sale ofthe investment is estmated at PSO0,000. Ben Hur Co, savings in purchasing the call option amounts to ‘A. 42632 USD ¢. 52632 USD D. 50,000 USD B. 62632 USD |AS provided in PFRS 9, the amount of gain that Glorietta Co. should recognize in other ‘comprehensive income for 2018s A PO 650,000 B. 550,000 D. 1,200,000 ‘Sabrina Co. reported an impairment loss of P250,000 in its income statement for the year 2015. This oss was related to an item of property, plant and equipment which was acquired on January 1, 2007 with a cost of P2,000,000 of no residual value. Depreciation on the asset is ‘computed on a straight line basis and annual depreciation on cass PB0,000. Depreciation for the year 2016 was computed on the assa's recoverable amount at December 31, 2015. On December 31, 2018, Sabrina decided to measure the asset using revalueton model. This asset was then appraised at afar value of P1,650,000. ‘The amount of the gain on impaiment recovery and the revaluation surplus, if any, that Sabrina Co, should repot in 2018 and shall be A a Gain on impairment recovery PO 203,125 750,000 PT.500,000 Revaluation surplus PO____P610,000 _F1,280,000_P1,030,000Detfna Co, suflered damages from a stom surge on December 31, 2018. The entre inventory and most of the accouning records were completely destoyed.Infoamation salvaged fom remaining records flows: January 1 Inventory, P750,000; Accounts receivable, P350,000 December 31, Purchases, 2,760,000; Cash sales, P450 000; Collections of accounts receivable, Pd 200,000, Accounts receivable, PS50,000; ‘Gross proft on sales, 40%. ‘The amount of inventory that was lst by Defina Co. from the storm surges, A. 590,000 . P1,350,000 8. P750,000 D. P1,560,000 Indusbia Co. acquired a patent on June 20, 2015 for P2,100,000. Management expects that ‘the patent wil be useful fo the company forts remaining useful life of 10 years. On January 10, 2017, Industria spent P350,000 in successfully defending the patent against a competitor. During 2018, management determines that the estimated remaining lif ofthe patent should be reduced to only five years, including the current year. Industa's policy is to amortize the ‘cost of intangible assets using straightline method tothe nearest month Industia Co's amortization expense fr the year 2018s. A. P234,000 . P336,000 B. P315,000 . P358,750 Develos Co. insured the life ofits president for P16,000,000, Develos being the beneficiary of ‘an ordinary insurance policy. The premium is P400,000. The polcy is dated January 1, 2014 ‘The cash surrender value on December 31, 2017 and 2018 are P120,000 and P160,000, respectively. Develos follows the calender year as its fiscal year. The president died on October 1, 208 and the policy was collected on December 31, 2018. No premium was refund ‘onthe insurance settlement. Develos Co's gain on ife insurance setementis. ‘A. P15,320,000, c. P15,780,000 B. P15,620,000 D. P16,000,000 Consuelo Co. converted PS 00,000 tonds ofits 10% converte bonds into 100,000 ordinary shares, P5D par vale on Jeruary 1, 2018, afer recording inleest and amortization. On the conversion date, the carving amount ofthe bonds were PS, 500,000 and the pid in capital, arising ftom the conversion prvlege recognized in the accounts is P200,000. The market vale ofthe bonds without the conversion privilege was PE 000,000, and Consuelo’ ordinary shares was publey trading at P6D esc, Under IAS 32, the amount of share premium that should be recognized by Consuelo Co. as a resultof the conversions. A 600,000 . P1,000,000 8 700,000 D. P1,200,000 Derick Co. had retained earings of P3,300,000 at the beginning of 2018. Throughout 2018, ‘the company had 20,000 shares of P100 par value ordinary shares that are issued and ‘outstanding. During 2018, Denviok reported profit of P5.500,000, purchased treasury shares for P600,000, dectared cash cividend of P1,600,000, reissued all reasury shares ala gain of 100,000, and deciared and issued a 10% ordinary share bonus issue when the market value ‘was P180 per share‘The retained earnings balance of Dervick Co. at December 31, 2018's, ‘A. 3,300,000 C. P6,740,000 B. 6,640,000 (0. 7,000,000. Nestor Co’'s owners equiy was afected by the folowing transactions during 2018, At the begining ofthe year, there are 100,000 orcnary shares oustanding February 1 21,000 ordinary shares were sold inthe markt. Purchase 5,000 ordinary shares to be hed in teasury dhly 1 tssued Pt, 000,000, 5-year, 10% bonds at face value Each Pt,000 bond is convert int 50 ordinary shares. July 135,000 ordinary shares were sol ‘October 1A 10% bonds issue was declared and dstibuted Profit forthe yeer ended December 31,2018 is P2,926,000. The tax rate is 20%, Nestor Co’s number of shares to be used in the calculation of diluted earings per share in 2018s ‘A P146,300 C. PIT1,300 B P150,425 D. P173;00 "Nestor Co's 2018 basic earnings per share and diluted eamings per share, respectively, shall be A. P16 and P16 aA . P2000 and P1684 B. P1945 and P17.04 ‘D. P20,00 and P17.04 ‘The folowing information pertain to to diferent companies Delmar Company has two classes of shares outstanding, 10%, P100 par preference share capital, ‘and P10 par ordinary share cepital. During the fiscal year ending June 20,2018, the company had the folowing transaction affecting shareholder's equity ‘Number of shares Pre per share Issue of preference shares 5,000 P40 Issue of ordinary shares 20,000 0 Retirement of preference share 4,000 160 Purchase of treasury share ~ Ordinary Shares 5,000 a ‘Share spl (Par value reduced to P5) 2or1 Reissue of treasury shares - Ordinary shares 5,000 2 ‘The balance of the accounts inthe shareholders’ equity secton as of June 20, 2017 statement of financial poston follows: Preference share capital, 30,000 shares, P3,000,000; Ordinary share capital, 100,000 shares, 1,000,000; Preference share premium, 1,200,000; Ordinary share premium, P8,000,000; and Retained earings, P2,550,000. Dividend were paid atthe end ofthe fiscal year on the ordinary shares at P6 per share and on the preference share at the preference rate. Profit aftr tax forthe year is P750,000 Jansen Company provided the following information: Dec. 31,2017 Dec. 31,2018 ‘Trade accounts receivable, net 840,000, 780,000 Inventory 4,500.00 1,400,000 ‘Accounts payable 950,000 980,000 Total sales were P12,000,000 for 2018 and 11,000,000 for 2047. Cash sales were 20% of total sales each year. Cost of goods sold was PB,400,000 for 2018. Each year there was PS0,000 bad debs estimate and a PS0,000 write-off‘The balance of additonal pai in capital of Delmar Company on June 30, 2018s, A. P2,620,000 C. 10,600,000 8. 9200,000 0D. P10.620,000 ‘The blance of retained eaings of Delmar Company on June 3, 20188 A. Psi 000 C. P1.580,000 3 P1550,000 D. a300.000 ‘The cash colectd by Jansen Company om customer dung 2018 is A. P11,890,000. C. P12,010,000 B Ptt.960,000 D. Pr2060,000 ‘The cash disbursed by Jansen Company from purchases during 2018 is_ ‘A. 8,200,000 C. P8,300,000 8B. P6,270,000 ‘D. 8,500,000 Nortngate Co. leased equipment from Sender Co. on July 1, 2018, for an eight-year period ‘expiring June 30, 2026. Equal annual payments under the lease are P200,000 and are due on duly 1, of each year. The first payment was made on July 1, 2018. The rate of interest contemplated by Northgate and Sander is 10%. The cash seling price ofthe equipment on Sande's accounting records was P1,100,000. Granada Co. provided the following information relative to its 2018 profit and loss: Profit before income taxes 2,880,000 Income tax expense Current 970,000, Deferred 90900 (4,060,000 Proft 1,820,000 Granada's first year of operation was 2018. The Company's tax rate is 30%. Manegement {decided to use accelerated depreciation for tx purposes and straight-line method fr financial reporting purposes. The amount charged to deprecition expense in 2018 was PB20.000 ‘Alhambra Co. provided the following information concerning its plan assets to cover a defined ‘benef plan forthe year 2018, The interest rate used by the entity is 10%. January 1 December 31 Fair value of plan assets 5,000,000 5,800,000 Contribution fo plan "500,000 Beneiits paid to ratiees 100,000 Mikzil Co. had the following loans outstanding in 2018: Specific construction ioan, 8% interest, 1,000,000; General purpose loan, 10% interest, 20,000,000. The entity begun the Self-constructed ofa bulding on January 1, 2018 and the bulking was contemplated on December 31, 2018. The folowing expenditures were made ‘during the year: January 1, P3,000,000; July 1, P6,000,000, November 1, P3,000,000, The amount of the profit on the sale and the interest income that Sander Co. would record for. tho yeu ended Deore 31,2018 stllbe ‘&. P0,000 and 52.000 ©. 340,00 and 52,000 8. P140000 ard P0400 . 340,00 and P104000 ‘The amount that Granada Co. did deduct for depreciation on its tax return for 2018, assuming the temporary iffeence existed between the book income and taxable income, was, ‘A. 830,000 ©. 1,060,000 B. Pot0,000 D. P1,120,000‘Alhambra Co’s actuarial gainoss in 2018 taken fo other comprehensive income i, 100,000 gain C. P400,000 gain 8. P100,000 oss 5. A00,000oss “The toll cos of tail Co’s new bling is A. P18,000,000 C. P19,440,000 B. P18.730,000 D. P19.800,000