4. What is the amount of total assets on December 31? At the beginning of current year, Baket Company started business and issued share capital, 60,000shares with P100 par, for the following considerations:Cash500,000Building with useful life of 15 years4,500,000Land1,500,0006,500,000An analysis of the bank statements showed total deposits, including the original cash investment ofP3,500,000.The balance in the bank statement on December 31 was P250,000 but there were checks amounting toP50,000 dated in December but not paid by the bank until January of next year.Cash on hand on December 31 was P125,000 including customers' deposit of P75,000.During the year, the entity borrowed P500,000 from the bank and repaid P125,000 and P25,000interest. The proceeds of the loan were credited to the bank account of the entity.Disbursement paid in cash during the year were:Utilities100,000Salaries100,000Supplies175,000Таxes25,000Dividends150,000550,000An inventory of merchandise taken on December 31 shoed P755,000 of merchandise.Tickets for accounts receivable totaled P990,000 but P50,000 of that amount may prove uncollectible.Unpaid suppliers' invoices for merchandise amounted P350,000.Equipment with a cash price of P400,000 was purchased in early January on a one-year installmentbasis.During the year, checks for the down payment and all maturing installments totaled P445,000. Theequipment has a useful life of 5 years.

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What is the amount of total assets on December 31?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.

Question

4. What is the amount of total assets on December 31?

At the beginning of current year, Baket Company started business and issued share capital, 60,000
shares with P100 par, for the following considerations:
Cash
500,000
Building with useful life of 15 years
4,500,000
Land
1,500,000
6,500,000
An analysis of the bank statements showed total deposits, including the original cash investment of
P3,500,000.
The balance in the bank statement on December 31 was P250,000 but there were checks amounting to
P50,000 dated in December but not paid by the bank until January of next year.
Cash on hand on December 31 was P125,000 including customers' deposit of P75,000.
During the year, the entity borrowed P500,000 from the bank and repaid P125,000 and P25,000
interest. The proceeds of the loan were credited to the bank account of the entity.
Disbursement paid in cash during the year were:
Utilities
100,000
Salaries
100,000
Supplies
175,000
Таxes
25,000
Dividends
150,000
550,000
An inventory of merchandise taken on December 31 shoed P755,000 of merchandise.
Tickets for accounts receivable totaled P990,000 but P50,000 of that amount may prove uncollectible.
Unpaid suppliers' invoices for merchandise amounted P350,000.
Equipment with a cash price of P400,000 was purchased in early January on a one-year installment
basis.
During the year, checks for the down payment and all maturing installments totaled P445,000. The
equipment has a useful life of 5 years.

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