Answered: 1. Cesar Vasquez, a businessman, has… | bartleby

SWFT Comprehensive Volume 2019

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter3: Computing The Tax

Section: Chapter Questions

Problem 42P

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Question

1. Cesar Vasquez, a businessman, has the following personal properties: Cash, P100,000
Land, P200,000; building, P11,500,000 and car P500,000. He invested his cash and car in
an eatery The other assets of the eatery were purchased and paid for using the investet
cash: furniture and fixtures, P30,000; equipment, P60,000 and supplies, P5,000.
Question: What accounting principle did you apply in recording the assets of the business
Required: List down the assets of the eatery.
2. Refer to the first number, but assume that Mr. Vasquez invested the car and only one hal!
of his personal cash in the business.
Question: How much should he borrow to be able to buy the other assets and still have
PI0,000 cash to be used as working fund?
Required: Prepare a statement of financial position for the business.
3. Hunt is the President of Digital Printing with investors who gave capital money of
P10,000,000. You hired Wanda as auditor of the firm. The investors were dissatisfied with
the net income carned by the business. The business earned only P20,000 but this was
before accrued expenses of P100,000 were recorded. Actually, the business was losing
Hunt asked Wanda to approve the reports prepared by Gil, the accountant who was
ordered to delay the recording until after the investors` meeting. If you are Wanda, what
will you do? Does loyalty to Hunt hold you in his good esteem forever? Think of all the
consequences that will happen after this.

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How many of the following statements regarding the concepts underlying the financial statements are true? The president of a sole proprietorship purchases a new recreational vehicle (RV) for personal use using their own funds. The RV would be recorded as an asset on the company's current financial statements. Large public companies often round their financial statement dollar amounts to the nearest $1,000 or $1 million. A company purchased land for $1 million in 2010. The land was recently appraised at $1.5 million. The land would be reported on the current balance sheet at $1 million.
A. Nenita Mendoza, who plans to go abroad, is selling her mini-donut business. Her friend Benita Peña is interested to buy it but can only afford to pay Php. 350,000. The following are the assets of Mendoza’s business.Book ValueMarket ValueEquipment (net if accumulated depreciation of Php. 25,000Php. 350,000Php. 300,000Support Equipment (net of accumulated depreciation Php. 5,000)75,00050,000Raw materials35,00025,000Franchise Right150,000100,000TotalPhp. 610,000Php. 475,000a. How much is the net worth assuming there is a mortgage note of Php. 150,000 attached to the equipment?b. Will Benita Peña be able to afford to buy the business?c. Make the entry in the books of Peña?
Ali, Mohammed and Abdullah started a business. They agreed to share responsibilities, skills, Profits and losses. Ali invested RO 10,000, Abdullah invested RO 12,000 and Mohammed invested RO 8000 in the business. They acquired the following : Machine worth RO 2000, Furniture worth RO 1000, Supplies worth RO 500, Motor Car worth RO 2000. They also have bills payable worth RO 50, Salaries payable RO 200, rent payable RO 50 and the business also has a long term loan of RO 5000. The business had Insurance expense of RO 500 and Utility expense of RO 200. Answer the following 3 questions based on the above case The type of the business is represented in the above case? Single Business Owner Sole Proprietorship Corporation Partnership If the partners decided to invest ( bring in capital in the form of cash) 1000 OMR more in the business , which account will you Debit in this transaction? Loan A/c Cash A/c Capital A/c Equity A/c If the partners decide to Withdraw 200 OMR each…
Shaun Pollok purchased a car wash for $480,000. If purchased separately, the land would have cost $120,000, the building $270,000, and the equipment $210,000. Determine the amount that should be recorded in the new business’s records for land, building, and equipment.
Hani Enterprise purchased a piece of land, a shoplot and some equipment for RM4,000,000. The cost value of the land was RM1,700.000, the building RM1,350,000 and the equipment RM950,000. What is the amount being debited to the Land Account when the purchase is recorded? a. RM1,700,000 b.RM4,000,000 c.RM3,100,000 d.None of the above
John invests office equipment with a fair market value of $63,000, manufacturing equipment with a fair market value of $76,000, and cash of $31,000. He owes $28,000, represented by a note on the manufacturing equipment. The amount of John's capital would be a. $170,000 b. $142,000. c. $31,000. d. None of these choices are correct.
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Johnson, Incorporated, had the following transactions during the year: Purchased a building for $5,000,000 using a mortgage for financing Paid $2,000 for ordinary repair on a piece of equipment Sold product on account to customers for $1,500,600 Paid $20,000 cash to add a storage shed in the corner of an existing building Paid $360,000 in monthly salaries Paid $25,000 for routine maintenance on equipment Paid $110,000 for extraordinary repairs Depreciation expense recorded for the year is $15,000. If all transactions were recorded properly, what is the amount of increase to the Property, Plant, and Equipment section of Johnsons balance sheet resulting from this years transactions? What amount did Johnson report on the income statement for expenses for the year?
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