Notes to Financial Statements

Note 1 - Statement of Compliance with PFRS

Note 2 - Summary of Significant Accounting Policies
Note 3 - Cash and Cash Equivalents
Cash on Hand ₱ 15,775.00
Petty Cash Fund ₱ 5,000.00
Cash in Bank - PNB (checking account) ₱ 62,600.00
Treasury Bills ₱ 200,000.00
₱ 283,375.00

Note 4 - Trade and Other Receivables

Dividend Receivables ₱ 5,000.00
Accounts Receivable ₱ 153,600.00
Subscription Receivable ₱ 100,000.00
₱ 258,600.00

Note 5 - Prepaid Expense

Prepaid Insurance ₱ 9,000.00
Office Supplies ₱ 1,400.00
Store Supplies ₱ 15,000.00
₱ 25,400.00

Note 6 - Property and Equipment

Land ₱ 600,000.00
Building ₱ 900,000.00
Office Equipment ₱ 160,000.00
Store Equipment ₱ 560,000.00
₱ 2,220,000.00

Note 7 - Long-Term Investments

Cash Held as Compensating Balance ₱ 50,000.00
Cash in Bank - BDO (time deposit) ₱ 700,000.00
₱ 750,000.00

Note 8 - Other Non-current Assets

Cash deposit - Angeles Electric Corporati ₱ 5,000.00
Advances to Officers ₱ 300,000.00
Rent Deposit ₱ 60,000.00
₱ 365,000.00

Note 9 - Trade and Other Payables

Customer's Accounts with credit balances ₱ 18,600.00
Accounts Payable ₱ 550,000.00
Accrued Expense ₱ 55,000.00
₱ 623,600.00

Note 10 - Share Capital

Share Capital, 100 par, 15,000 shares ₱ 1,500,000.00
Subscribed Share Capital, 3,000 shares ₱ 300,000.00
₱ 1,800,000.00
Note 11 - Reserves
Unrealized Gains ₱ 20,000.00
Share Premium ₱ 428,817.00
Treasury Shares Appropriation ₱ 110,000.00
₱ 558,817.00

Note 12 - Net Sales

Gross Sale ₱ 8,697,590.00
Less: Sales Returns -₱ 115,750.00
₱ 8,581,840.00

Note 13 - Cost of Sales

Merchandise Inventory, Jan 1 ₱ 800,000.00
Add: Purchases ₱ 5,800,352.00
Total Goods Available for Sale ₱ 6,600,352.00
Less: Merchandise Inventory, Dec 31 -₱ 775,000.00
₱ 5,825,352.00

Note 14 - Other Income

Dividend Income ₱ 5,000.00
Interest on Treasury Bills and Time Deposi₱ 95,166.00
₱ 100,166.00

Note 15 - Selling Expenses

Utilities Expense ₱ 135,000.00
Rent Warehouse ₱ 240,000.00
Sales Salaries ₱ 550,000.00
Store Supplies Used ₱ 72,000.00
Insurance Expense ₱ 9,000.00
Depreciation - Building ₱ 67,500.00
Depreciation - Store Equipment ₱ 70,000.00
₱ 1,143,500.00

Note 16 - Administrative Expenses

Utilities Expense ₱ 15,000.00
Taxes and Licences ₱ 50,000.00
Office Salaries ₱ 340,000.00
Office Supplies Used ₱ 10,000.00
Depreciation - Building ₱ 7,500.00
Depreciation - Office Equipment ₱ 20,000.00
₱ 442,500.00

Note 17 - Other Expenses

Impairment Loss on Assets held for Sale:
Land ₱ 200,000.00
Building, net of depreciation ₱ 450,000.00
Total Carrying Ammount ₱ 650,000.00
Fair Value Less Cost to Sale -₱ 600,000.00
Impairment Loss ₱ 50,000.00
Note 18 - Finance Cost
Interest on Bonds ₱ 120,000.00
Interest on Loan Payable ₱ 15,000.00
₱ 135,000.00
Date Account Titles Debit Credit Accumulated
Dec-31 Dividends Receivable ₱ 5,000.00 Cost Depreciation Carrying Amount
Dividend Income ₱ 5,000.00 Land ₱ 800,000.00 ₱ - ₱ 800,000.00
# Building ₱ 1,500,000.00 ₱ 150,000.00 ₱ 1,350,000.00
31 Financial Assets at Fair Value ₱ 20,000.00 Office Equipment ₱ 200,000.00 ₱ 40,000.00 ₱ 160,000.00
Unrealized Gains - FAFV ₱ 20,000.00 Store Equipment ₱ 700,000.00 ₱ 140,000.00 ₱ 560,000.00
#
31 Assets held for sale ₱ 650,000.00
Accumulated Depreciation - Building ₱ 50,000.00 Accumulated
Land ₱ 200,000.00 Cost Depreciation Carrying Amount
Building ₱ 500,000.00 Land ₱ 600,000.00 ₱ - ₱ 600,000.00
# Building ₱ 1,000,000.00 ₱ 100,000.00 ₱ 900,000.00
Impairment Loss ₱ 50,000.00 Office Equipment ₱ 200,000.00 ₱ 40,000.00 ₱ 160,000.00
Assets held for sale ₱ 50,000.00 Store Equipment ₱ 700,000.00 ₱ 140,000.00 ₱ 560,000.00
 Geoffrey Company
Statement of Changes in Equity
For the Year Ended December 31, 2015
Subscribed Share Retained
Share Capital Capital Reserves Earnings Treasury Shares
Balance, January 1, 2015 ₱ 1,500,000.00 ₱ 300,000.00 ₱ 428,817.00 ₱ 610,000.00 ₱ -
Correction of error - Omission of 2014 depreciation -₱ 165,000.00
Acquisition of treasury shares ₱ 110,000.00
Net Income for 2015 ₱ 759,958.00
Unrealized Gain - FAFV ₱ 20,000.00
Treasury shares appropriation ₱ 110,000.00 -₱ 110,000.00
Balances, December 31, 2015 ₱ 1,500,000.00 ₱ 300,000.00 ₱ 558,817.00 ₱ 1,094,958.00 ₱ 110,000.00
 Geoffrey Company
Statement of Comprehensive Income
For the Year Ended December 31, 2015

Note
Net Sales 12 ₱ 8,581,840.00
Cost of Sales 13 -₱ 5,825,352.00
Gross Income ₱ 2,756,488.00
Other Income 14 ₱ 100,166.00
Total Income ₱ 2,856,654.00
Expenses:
Selling 15 ₱ 1,143,500.00
Administrative 16 ₱ 442,500.00
Other Expense 17 ₱ 50,000.00
Finance Cost 18 ₱ 135,000.00
Total Expenses -₱ 1,771,000.00
Net Income before Income Tax ₱ 1,085,654.00
Income Tax Expense -₱ 325,696.00
Net Income before Income Tax ₱ 759,958.00
Other Comprehensive Income:
Unrealized Gain - FAFV ₱ 20,000.00
Comprehensive Income ₱ 779,958.00
 Geoffrey Company
Balance Sheet
December 31, 2015

Assets Note Liabilities & Shareholders' Equity Note

Current Assets: Current Liability:
Cash and Cash Equivalents 3 ₱ 283,375.00 Trade and Other Payables 9 ₱ 623,600.00
Cash in closed bank - Urban ₱ 50,000.00 Non-Current Liabilities:
Financial Assets of FV ₱ 140,000.00 Bonds Payable ₱ 1,000,000.00
Trade and Other Receivables 4 ₱ 258,600.00 Loan Payable, PNB ₱ 500,000.00
Merchandise Inventory ₱ 775,000.00 Total Non-Current Liabilities ₱ 1,500,000.00
Assets held for sale ₱ 600,000.00 Total Liabilities ₱ 2,123,600.00
Prepaid Expenses 5 ₱ 25,400.00
Total Current Assets ₱ 2,132,375.00 Shareholders' Equity
Share Capital 10 ₱ 1,800,000.00
Non-Current Assets: Reserves 11 ₱ 558,817.00
Property and Equipment, net 6 ₱ 2,220,000.00 Retained Earnings ₱ 1,094,958.00
Long Term Investments 7 ₱ 750,000.00 Treasury Shares -₱ 110,000.00
Other Non-Current Assets 8 ₱ 365,000.00 Total Shareholders' Equity ₱ 3,343,775.00
Total Non-Current Assets ₱ 3,335,000.00

Total Assets ₱ 5,467,375.00 Total Liabilities and Shareholders' Equity ₱ 5,467,375.00