Financial Accounting
3rd Edition
ISBN: 9780133791129
Author: Jane L. Reimers
Publisher: Pearson Higher Ed
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Chapter 10B, Problem 6EB
To determine
Indicate the manner that the effects of each group of securities will be reported on the financial statements.
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1. Current assets include cash P3,800, accounts receivables P18,500, note receivables (maturity date is on July 1,2023) P10,000 and land P12,000.
2. Long term investments include a P4,600 investment in fair value though other comprehensive income securitiesthat is expected to be sold in 2022 and a P9,000 investment in AllDay company bonds that are expected to be helduntil their December 31, 2029 maturity date.
3. Property and equipment include buildings costing P63,400, inventories costing P30,500 and equipment costingP29,600.
4. Intangible assets include patents that cost P8,200 and on which P2,300 amortization have accumulated, andtreasury shares that costs P1,800.
5. Other assets include prepaid insurance (which expires on November 30, 2022) P2,900, sinking fund for bondretirement P7,000 and trademarks that cost P5,200 and on which P1,500 amortization has accumulated.
6. Current liabilities include accounts payable P19,400, bonds payable…
The following information is also available:
1. Current assets include cash P3,800, accounts receivables P18,500, note receivables (maturity date is on July 1, 2023) P10,000 and land P12,000.
2. Long term investments include a P4,600 investment in fair value though other comprehensive income securities that is expected to be sold in 2022 and a P9,000 investment in AllDay company bonds that are expected to be held until their December 31, 2029 maturity date.
3. Property and equipment include buildings costing P63,400, inventories costing P30,500 and equipment costing P29,600.
4. Intangible assets include patents that cost P8,200 and on which P2,300 amortization have accumulated, and treasury shares that costs P1,800.
5. Other assets include prepaid insurance (which expires on November 30, 2022) P2,900, sinking fund for bond retirement P7,000 and trademarks that cost P5,200 and on which P1,500 amortization has accumulated.
6. Current liabilities include accounts payable P19,400, bonds…
1. On July 1, Coastal Distribution Company is considering leasing a building and buying the
necessary equipment to operate a public warehouse. Alternatively, the company could use the
funds to invest in $740,000 of 4.5% U.S. Treasury bonds that mature in 14 years. The bonds
could be purchased at face value. The following data have been assembled:
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