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Geoffrey Company is on its 2nd year of operation and you have been hired to prepare its 2015

financial statement based on IFRS. In the course of your work, you have assembled the following
data:
Cash on hand and in bank:
Petty cash fund P 5,000
Cash on hand 15,775
Cash deposit – Angeles Electric Corporation 5,000
Cash in bank – PNB (checking account) 112,600
Cash in bank – Urban Bank (Closed bank) 50,000
Cash in bank – BDO (Time deposit) 700,00
Additional Information:
1. A minimum deposit balance of P50,000 in the PNB-checking account is required in
connection with the granting of P500,000, 12% loan on October 1, 2015. Interest is payable
every September 30, no interest has been accrued for 2015.
2. The BDO time deposit was placed with the bank on February 1, 2015 and will mature on
January 31, 2015.
3. The Urban Bank account is scheduled for collection in 2016.
Financial Assets:
Treasury Bills P200,000
SMC Ordinary Shares, P10 par, 10,000 shares 120,000

Additional Information:
1. The treasury bills were purchased on November 01, 2015 and will mature on January 31,
2016.
2. Geoffrey is not engaged in the buying and selling of securities. The SMC shares were
purchased as short-term investments to be sold when the need for working capital arises. On
December 15, 2015, SMC declared a cash dividend of P0.50 per share payable on January
30, 2016. The market value per SMC share on December 31, 2015 is P14.
Receivables:
Customers’ accounts with debit balances P153,600
Customers’ accounts with credit balances 18,600
Advances to officers, due December 2017 300,000
Prepayments:
Prepaid Rent P60,000
Prepaid Insurance 9,000

Additional Information:
1. On February 1, 2014, Geoffrey entered into a five-year lease contract for a warehouse at
P20,000 monthly rental. The P60,000 prepaid rent represents a 3-month rent deposit to be
applied in the last 3 months of the lease.
2. The insurance is for the warehouse.
Inventory:
Merchandise Inventory, January 1, 2015 P800,000
Merchandise Inventory, December 31, 2015 775,000
Office Supplies, December 31, 2015 1,400
Store Supplies, December 31, 2015 15,000
Property and Equipment:
Land P800,000
Buildings 1,500,000
Office Equipment 200,000
Store Equipment 700,000

Additional Information:
1. All property and equipment were acquired from a predecessor corporation on January 1,
2014. No depreciation has been applied to the depreciable assets although Geoffrey
informed you of its intention of using the straight-line method by applying a fixed rate of 5%
for the building and 10% for the equipment with no salvage value. 10% of building is occupied
by administration while 90% is occupied by the store.
2. On December 29, 2015, the board of directors passed a resolution authorizing the sale in
2016 of land and building with a carrying amount of P200,000 and P450,000 respectively.
The land and building has a fair value less cost to sell of P600,000 on December 31, 2015.
Payables:
Accounts Payable P550,000
Accrued Expense (exclusive of interest payable) 40,000
Bonds Payable, due December 31, 2018 1,000,000
Loan Payable, due September 30, 2018 500,000

Shareholders’ Equity:
Share Capital, P100 par, 30,000 shares P1,500,000
authorized, 15,000 shares issued
Subscribed Share Capital, 3,000 shares 300,000
Share Premium 428,817
Retained Earnings, January 1, 2014 610,000
Treasury Shares, at cost (1,000 shares) 110,000
Additional Information:
1. Subscription receivable of P100,000 is due for collection in 2016.
Revenues and Expenses for 2015:
Gross Sales P8,697,590
Sales Returns 115,750
Purchases 5,800,352
Interest on Bonds 120,000
Interest on treasury bills and time deposit 95,166
Utilities Expense (10% administration; 90% store) 150,000
Taxes and licenses 50,000
Rent-warehouse 240,000
Sales Salaries 550,000
Office Salaries 340,000
Store Supplies Used 72,000
Office Supplies Used 10,000
Insurance Expense 9,000

Required: Prepare the following financial statements in accordance with IFRS:


1. Statement of Comprehensive Income
2. Statement of Retained Earnings
3. Balance Sheet