INES. 7 POLYTECHNIC UNIVERSITY OF THE PHILII College of Accountancy & Finance 4th Evaluation Examn| Mi ‘ACO 4103 - AUDITING PROBLEMS Instruction: Mark properly the letter of the best onswer on the scannable onswer sheet. Good luck! Abellera Comy Shown below ste bank reconciltion for Abellera Company for November 2017. Balance per bank, November 30,2017 300,000 ‘Add: Deposits in ansit 48,000 Tetal 7348,000 Less: Outstanding checks P56,000 " Bank credit recorded in err 20.000 _76,000 Balance per Books, November 30, 2017 roo The bank statement for December 2017 contains the following data Total deposits 220,000 Total charges, including an NSF check of P16,000 and a 192,000 service charge of P800 All outstanding checks on November 30, 2017, including the bank credit, were cleared in the bank in ‘December 2017, There were outstanding checks of PE0,000 and deposits intrensit of P76,000 on December 31, 2017. Based on the above information and the audit resuit, answer the following: 11, Hew much is the recelpts per books in December 2017? 2. P296,000 b. 248,000 < 228,000 d, 220,000 2. How much isthe disbursements per books in December 2017? a. P192,000 'b.P179,200 159,200 4. 196,000 3. How much isthe cash balance per books on December 33, 2037? 3. 360,800 ‘6. P300,000 & P324,000 4. 340,800 14. How much is the adjusted cash in bank as of December 31, 2017? a, P392,000 b. 283,200 344,000 4. 324,000 Austria Corporation «Gn January 1, 2015, Austria Corporation issued a 3-yer, 8,000, P1,000 convertible bonds at 110. Interests 1on rate of 12% every December 31. Eack bond is convertible at the ‘tobe paid annually atthe stated coup holders option into 30, P25 par value ordinary shares at anytime up to maturity. Qn the date of issuance prevaling market interest rate for similar debt without the conversion privilege was 9%, On the same date, ‘market price of one ordinary share was P30. Considering the above data, answer the following: How much is the equity component of the convertible debt? ‘a. P800,000 b, P422,335 . P192,352 a Po How much js the resulting bonds payable carrying value as of December 31, 20157 8.422.396. P8,607,648 © ¢.P,220,346 = d._ 8,000,000 7, assuming that the convertible bonds were converted on January 1, 2017,how much the net increase in ‘Share premium/additionalpald-in capital from the equity conversion? 2. 72220346 b, P2,412698 «= «214,688. PO ‘Assuming thatthe convertible bonds were retired at 98 on January 1, 2017 when the prevaling quoted valve aaaa yore at 26, how much the gain or los tobe recognized inthe Income statement forthe d, 540,346 retirement? a, P380,346 b. P572,698 &P160,0000 4 10, 11 2, 3B. ING PROBLE! Angeles Company : sition showed the following balances On December 31, 2016, Angeles Company’ statement of financial position. related tots securities accounts. FV Through Pa 1,477,500 FY Through oci 1,180,000 lero eel 2a Bond 0.00 Unrealized Gain Fvocl sata ing securities Angeles Company's securities portfli on December 31,2016 was made up ofthe followin Security Class Cost ee 10,000 shares Filex Corp. stock FPBL_-—«7750,000-——P762,500 8,000 shares Aepo, Inc. stock FvPal ‘$50,000 528,250 10% Zuric bonds - interest payable Jan. 4 and July 1 Fvpat 250,000 ue 10,000 shares SMDM, Inc. stock FVOCI_ ‘590,000 630,000 20,000 shares JGabs, Inc. stock Fvoc! 490,000 550,000 Aan. Received interest on the Zure bonds. larch 1 Purchased 3,000 shares additional shres of Fllex Corp. stock for 229,500, classified as FVPAL, April 15. Sold 4,000 shares of the Aepo, Inc. stock for P69 per share. May 4 Sold 4,000 shares of the SMDM, Inc. stock for P62 per share. July 1 Received interest on the Zuric bonds. Oct. 30 Parchased 15,000 shares of BPMP Co. stock fo P832,500 cased as The market values ofthe stocks and bonds on December 31, 2017 areas follows: Filex Corp. stock P76.60 per share ‘Aepo, nc. stock 68.50 per share BPMP Co. stack 95.25 pershare ‘SMOM, Inc. stock £61.00 per share 4Gabs, Inc. stock 27.00 pet share Zuric bonds 205,550 Based on the above data and the result of your audit, determine the following: Gain oF loss on sale of 4,000 Aepo, Inc. shares on April 15, 2017 was 2. P1,000gzin ob. PAI87Sloss ce. PI,000 loss. d._PAI.875 gain Gain or loss on sale of 4,000 SMDM, Inc shares on May 4, 2017 was a. P8,000gain —b, P12,000gain —<. P4,000gain dP Carrying amount of FVP&AL as of December 31, 2017 was a. 2,287,800 —b P2,337,000 ©. P2,297,400 © d._ 2,304,100 Carrying amaount of FVOC! as of December 31, 2017 was a. P84d,000 b. 906,000 <. P944,000 4. 806,000 ‘What amount of unrealized gain or loss should be shown as component of shareholders’ equity as of December 31, 2017? a P22,000loss —b.PG62,000 gain c.-P112,000loss. dd. P78,000gainvamcsomamg 2 The bal lance sheet 2016: OF Acojedo ‘poration ee ‘ation reported the following long tern tecelvables ax of December 3, Notes recevay ots receivabe om Ince tabi trom ome 4,500,000 Inconnestion wth our sean 1.200000 formation pea su YU were seo ahr fawn anatons ing2017 a other epee neat company len tem eas The ae eta om thea Bese ot 12pm. treat artlin 3 anna instars ot 2.5000 pints on eateat balance every Ap. Tena pnp andere amen 5. {ase on ap. 20h Pe ee resale mfr hed Once 3206 einer mum, and is due on December 31,2019. The 2017 intrest as «___ etiedon scenber3,2017 he corporation old place of equipment o RAM Company on Api 12017 in exchange or 50,20 non eet boing ee don 22018 e note had no ready markt, and there was no established exchange pce forthe equipment. The prevaling interest rate forthe note ofthis type at Apri 1, 2017 was 12%. The present value factor of 1 oF two prtds at 12K Is 0.797 while the present valve fctr of ordinary annuity of fr two periods at 12%is 1.600 A tact of land was sod by the corporation to MHL Company ony 3, 2017 for 3,000,000 under an installment sale contrac. MHL signed ayer, 1% note for ?2,100,000 on luly 3, 2037 n ain to the down payment of 900,000. The equsl annual payments of principal and intrest onthe note will be P576,875 payable on uly, 2018, 2018, 2020 and 2021. The land has Sr estblshed cash pic of P3,00,000, nds ost tothe corporation was 2,250,000. The collection ofthe installments on thls note sreasonably assured. Based on the above and the result of your audit, answer the following: ow much isthe total current portion of long-term notes receivable as of December 31, 20177 2. P1500,000 ib, PL945,875—c. P2ATBSTS =. POS ich isthe total nancurrent notes receivable as of December 32, 20177 d, p4,832,325, 14, 15, How mu a. 6,778,200 —-b. P5,278,200 cP, 875,363 416, Whats the correct accrued interest receivable as of December 31, 2017? a, P428,538 b, P505,500 270,000 4, 385,500 117, What isthe correct interest income forthe year 2017? b. P756,000 c. P683,538 4. 640,500 3. PB18,538