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Practical Accounting Problems 2 RE HERMOSILLA/BN CASTUCIANO

1st Preboard Examination - Solutions October 2013

1. The answer is letter A

Cost Method
200,000 ( 30,000 x 20% ) = P 194,000
Equity Method
200,000 + ( 30,000 10,000 ) 36,000 = P 184,000
2. The answer is letter D

3. The answer is letter D

Share in Net Loss ( 100 T x 25% ) 25,000
Amortization ( 150,000 x 10% ) 15,000
Investment Loss 40,000

4. The answer is letter B

Acquisition Cost 550,000 or BV ( 1,600 + 100 120 ) 25%
395,000
Share in NI ( 200 T 100 ) 25% 25,000 UE
150,000
Dividends ( 120 T x 25% ) (30,000) CV
545,000
CV 545,000

5. The answer is letter A

CNI
PL NI for the year 300,000
SNI ( 120,000 x 4/12 ) 40,000
Share in NI in 8 months
January to August 31 ( 120 T x 8/12 x 25% ) 20,000
CNI 360,000

6. The answer is letter B

MINI
( 120 t x 4/12 ) 40% 16,000
7. The answer is letter D

8. The answer is letter B ( 40% direct holdings + [ ( 80 x 15% ) ] = 52%

9. The answer is letter B

10. The answer is letter C

Total COS of T & S 800,000
UP beg ( 20 T x 30% ) ( 6,000)
Inter Co. Sales (110,000)
UP end ( 30 T x 30% ) 9,000
Consolidated COS 693,000
11. The answer is letter D
Total Amortization Expense per books 190,000
Amortization ( 196T 180T ) / 10 .. 1,600
Total 191,600
12. The answer is letter A

13. The answer is letter B 40,000 = 25,000 + 10% (NI B S )

40,000 = 25,000 + 10% (NI 15,000 125,000)
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40,000 = 25,000 + .INI 14,000
40,000 11,000 = . INI
29,000 = . INI
290,000 = NI

14. The answer is letter A

TCC TAC
R 200 (8)
J 100 (12) 88,000
G 100 20 120
400 0 400
Bonus to Gen = 5,000
Share of J in the residual profit ( 50,000 x 40 % ) = 20,000

15. The answer is letter D

Equity balance of E 50,000
Amount Paid 46,000
Bonus to C & D 4,000
C 120,000 + ( 3/5 x 4,000) 122,400
D 60,000 + ( 2/5 x 4,000) 61,600

16. The answer is letter A

R E H Total
Equity 32,000 24,900 15,000 71,900
Loss (12,000) ( ( ( 24,000)
) )
CAFD 20,000 _________ _________ 47,900
Proceeds = 47,900 + 20,000 6,000 = 61,900

17. The answer is letter B

Dennis Brisbane Ric Total
15,000 10,000 10,000 35,000
(5,000) (5,000)
( 200 ) ( 200 )
100 50 50 200
9,900 10,050 10,050 30,000
(12,500) ( 6,250) (6,250) (25,000)
( 2,600 ) _________ _________ 5,0000

18. The answer is letter B

A B C D Total
60 40 30 10
140
(15)
(15)
1.5 .900 .300 .300 3
46,500 40.900 30,300 10,300
128,00
0
(49,000 (29,400 (9,800) (9,800)
) ) (98,000
)
ANS 20,500 500
( 2,500 11,500 30,000
)
2,500 (.500) (500)
( 1,500)
0 10T 20 0 30T
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19. The answer is letter A

GI ( 150 40 + 10 ) 120,000
Expenses 20,000
NI 100,000
D E F
Share 50,000
30,000 20,000
E/D 40,000 _______
(10,000
)
Inc in Cap 90,000
20,000 20,000

20. The answer is letter C

J K L Total
88,000 62,000 56,000 206,000
58.6 ( 29,300) ( 29,300) ( 117.2 )
29,40 32,700 26,700 88,80
0 0

21. The answer is letter C

Allocation Made
R J V Total
Sal 20 15 - 35
Bonus 1667 - - 1.667
Bal 3333 6666 23,334 33,3333
Total 25,000 70T
Should be
Sal 20 15 - 35
Bal ( 500 ) ________ ________ ( 5 )
19,500 ________ ________ ( 5 )

Decrease by5,500

22. The answer is letter D

Cap. bal. 350 200 90 640
Adj. ( 50 ) ( 30 ) (20) (100)
Bal. 300 170 70 540

TCC TAC
G 300 ( 30 ) 270
N 170 ( 8) 162
L 70 30 108
F 270 270
810 810 (540 /
2/3 )

23. The answer is letter A

Equity of retiring partner 200,000
Amount Paid 225,000
Share in Revaluation/GW 25,000
.5
Total 50,000
x
Share of Remaining Partners 25,000
CRC-ACE/P2: 1st Pre-board Solution (October 2013 Batch Page
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Cap. of Remaining Partner s 200,000
Total 225,000

24. The answer is letter D

25. The answer is letter C
26. The answer is letter C
27. The answer is letter D
28. The answer is letter B
29. The answer is letter C
30. The answer is letter D
31. The answer is letter C
32. The answer is letter B
33. The answer is letter D
34. The answer is letter B
35. The answer is letter D
36. The answer is letter D
37. The answer is letter C

38. The answer is letter A

TCC TAC
J 40 ( 3 ) 37,000
In 30 ( 1.8 ) 28,200
IZ 20 ( 1.2 ) 18,800
R 30 6 36
120 0 120 [ 90/ (1 5/6 x 30 ) ]

39. The answer is letter C

146, 000 106,000 + 2,000 = P 42,000

40. The answer is letter D

( 39,386 4,286 ) / .3 = P 117,000

41. The answer is letter A

COI - 40,000
FV of NA acd 33,880
GW 6,120

42. The answer is letter D or 100% of Subsidiary SHE.

43. The answer is letter A

Total NI ( 60 + 30 ) 90,000
Amortization
30,000 / .6 = 50,000 / 15 ( 3,333 )
12,000 / .6 = 20,000 / 40 ( 500 )
CNI P 86,167

44. The answer is letter B

COST 200,000
Share in NI ( 120 T x 60 % ) 72,000
Div ( 70 T x 60 % ) ( 42,000 )
Amortization
8,000 + ( 4/15 x 30 T ) + ( 4/40 12T ) ( 17,200 )
CV 212,800
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45. The answer is letter A

Net Assets FV 1,300,000/100 = 13,000 P/S shares

GW
Annual NI 481,000
Normal Earnings 195,000
Excess 286,000
.2
GW to be issued C/S 1,430,000
x 30%
Prem. payable in cash 429,000

reh/cel