AP Liabilities Supporting Computation
PROBLEM NO. 1 - Heats Corporation
Requirement no. 1
Notes payable:
Arising from purchase of goods
Arising from bank loans, on which marketable securities valued at P600,000 have pledged as security, due Dec. 31, 2005
Arising from advances by officers, due June 30, 2005
Employees’ income tax withheld
Advances received from customers on purchase orders
Containers’ deposit
Accounts payable arising from purchase of goods (P170,000 + P30,000)
Customers' account with credit balance
Cash dividends payable
Current portion of serial bonds (P50,000 x 2)
Overdraft with Allied Bank
Est. damages to be paid as a result of unsatisfactory performance on a contract
Est. expenses on meeting guarantee for service requirements on mechandise sold
Estimated premiums payable
Deferred revenue
Accrued interest on bonds payable
Provision - deficiency income tax assessment
TOTAL CURRENT LIABILITIES
500,000
50,000
20,000
64,000
50,000
200,000
40,000
80,000
100,000
90,000
160,000
120,000
75,000
87,000
360,000
200,000
2,500,000
A
Convertible bonds, due January 31, 2007
Noncurrent portion of serial bonds (P2,000,000 - P100,000)
TOTAL NONCURRENT LIABILITIES
1,000,000
1,900,000
2,900,000
B
5,400,000
C
TOTAL LIABILITIES (Requirement no. 2)
304,000
PROBLEM NO. 3 - Pistons Company
Item no. 2
Item no. 6
Item no. 8
Item no.10
Item no.11
Item no.12
Item no.19
Insurance expense (P24,000/12 x 1/2)
Prepaid insurance
1,000
Prepaid dues and subscription
Dues and subscription exp
5,000
Vouchers payable
Inventory
1,000
5,000
111,500
111,500
Legal and professional expense
Vouchers payable
46,000
Medical expense
Vouchers payable
25,000
Inventory
Vouchers payable
55,000
Machinery and equipment
Vouchers payable
46,000
25,000
55,000
254,000
254,000
PROBLEM NO. 2 - Sonic Corporation
1 Accounts payable per general ledger
Debit balances in suppliers' accounts
Goods in transit on 12/31/05, FOB shipping point
Unrecorded purchase return
Adjusted accounts payable
Accrued janitorial
Requirement no. 1
Notes payable:
Arising from purchase of goods
Arising from bank loans, on which marketable securities valued at P600,000 have pledged as security, due Dec. 31, 2005
Arising from advances by officers, due June 30, 2005
Employees’ income tax withheld
Advances received from customers on purchase orders
Containers’ deposit
Accounts payable arising from purchase of goods (P170,000 + P30,000)
Customers' account with credit balance
Cash dividends payable
Current portion of serial bonds (P50,000 x 2)
Overdraft with Allied Bank
Est. damages to be paid as a result of unsatisfactory performance on a contract
Est. expenses on meeting guarantee for service requirements on mechandise sold
Estimated premiums payable
Deferred revenue
Accrued interest on bonds payable
Provision - deficiency income tax assessment
TOTAL CURRENT LIABILITIES
500,000
50,000
20,000
64,000
50,000
200,000
40,000
80,000
100,000
90,000
160,000
120,000
75,000
87,000
360,000
200,000
2,500,000
A
Convertible bonds, due January 31, 2007
Noncurrent portion of serial bonds (P2,000,000 - P100,000)
TOTAL NONCURRENT LIABILITIES
1,000,000
1,900,000
2,900,000
B
5,400,000
C
TOTAL LIABILITIES (Requirement no. 2)
304,000
PROBLEM NO. 3 - Pistons Company
Item no. 2
Item no. 6
Item no. 8
Item no.10
Item no.11
Item no.12
Item no.19
Insurance expense (P24,000/12 x 1/2)
Prepaid insurance
1,000
Prepaid dues and subscription
Dues and subscription exp
5,000
Vouchers payable
Inventory
1,000
5,000
111,500
111,500
Legal and professional expense
Vouchers payable
46,000
Medical expense
Vouchers payable
25,000
Inventory
Vouchers payable
55,000
Machinery and equipment
Vouchers payable
46,000
25,000
55,000
254,000
254,000
PROBLEM NO. 2 - Sonic Corporation
1 Accounts payable per general ledger
Debit balances in suppliers' accounts
Goods in transit on 12/31/05, FOB shipping point
Unrecorded purchase return
Adjusted accounts payable
Accrued janitorial