12. On March 1, 2015, Gared Company began construction of a building. The following expenditures were incurred for construction: March 1, 2015 P1,050,000 August 29, 2015 October 2, 2015 December 30, 2015 5,000,000 17,950, 000 6,000,000 6,000,000 4,000,000 P40,000,000 May 1, 2016 June 30, 2016 Total Included in March 1, 2015 expenditures are materials purchased on account for P50,000. The account was paid on October 2, 2015. The building was substantially completed on June 30, 2016. To help pay for construction P5,000,000 was specifically borrowed on March 1, 2015 on a 12%, two-year note payable. Interest income earned while the loan is not yet fully utilized amounted to P50,000 in 2015 and nil in 2016. Other general debts during 2015 to 2016 are as follows: 10% 5-year Note Payable dated February 8% 10-year Bonds Payable 8,000,000 10,000,000

12. On March 1, 2015, Gared Company began construction of a building. The following expenditures were incurred for construction: March 1, 2015 P1,050,000 August 29, 2015 October 2, 2015 December 30, 2015 5,000,000 17,950, 000 6,000,000 6,000,000 4,000,000 P40,000,000 May 1, 2016 June 30, 2016 Total Included in March 1, 2015 expenditures are materials purchased on account for P50,000. The account was paid on October 2, 2015. The building was substantially completed on June 30, 2016. To help pay for construction P5,000,000 was specifically borrowed on March 1, 2015 on a 12%, two-year note payable. Interest income earned while the loan is not yet fully utilized amounted to P50,000 in 2015 and nil in 2016. Other general debts during 2015 to 2016 are as follows: 10% 5-year Note Payable dated February 8% 10-year Bonds Payable 8,000,000 10,000,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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