52. On September 1, 2021, Mr. Mario Marasigan puts up a business and brings in office equipment of P150,000 and inventory of P30,000 to it. Mr. Marasigan puts P80,000 to the entity's cash box and P100,000 into the business' bank account. The business lends P50,000 cash to MC Enterprises and borrows P300,000 from the bank to acquire a piece of land. What is the amount of the business' capital on Sept. 1, 2021? P280,000 P360,000 P260,000 O P510,000
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- In February 2020, Ola Gott invested an additional $12000 in her business, Gott's Pharmacy, which is organized as a proprietorship. Gott's accountant, Sal Costa, recorded this receipt as an increase in cash and revenues. Is this treatment appropriate?On June 1, 2021, Cline Company paid P800,000 cash for the assets and liabilities of Renn Corp. The carrying values for Renn's assets and liabilities on June 1, 2021 follow: Cash - P150,000; Accounts receivable - P180,000; Capitalized software costs - P320,000; Goodwill - P100,000; and Liabilities - P130,000. On June 1, 2021, Renn's accounts receivable had a fair value of P140,000. Additionally, Renn's in-process and development costs was estimated to have a fair value of P200,000. Renn Corp. had a contingent liability of P20,000, the fair value of which was P15,000. Renn agreed to indemnify Cline for P10,000 for the contingent liability. All other items were stated at their fair values. On Cline's June 1 balance sheet. How much is reported for goodwill? A. P90,000 B. P85,000 C. P130,000 D. P125,000On November 2022 the Carlos family, which consists of 10 family members agreed to establish a rural bank. Each of the family members agreed to contribute P1,000,000.00 each, as their capital for a total of P10,000,000.00 The said family members agreed not to include any other persons in their intended rural bank, so they decided to put up a close corporation and registered it to the Security and Exchange Commission (SEC) As a commissioner of the SEC, what will you required from the said incorporators in establishing their corporation?
- On January 1, 2021, Super Balut Co. establishes a branch for an initial cash investment of P10,000,000. The subsequent transactions are as follows: a. On January 3, 2021, the home office acquires land and building to be used by the branch for a total cost of P30,000,000. The branch records the assets in its books. The fair value of the land is P11,000,000, while the fair value of the building is P22,000,000. The building has an estimated useful life of 20 years and no residual value. The company uses the straight-line method of depreciation. b. On February 14, 2021, the home office transfers inventory worth P20,000,000 to the branch. The home office pays freight of P500,000. c. On March 1, 2021, the home office transfers additional inventory worth P5,000,000 to the branch. This time the branch pays the freight of P100,000. d. On March 31, 2021, the branch acquires equipment for P900,000 cash. The equipment will be carried in the home office’s books. The equipment has a useful life of…Mr. Wa Is started a service business on October 1,2020 with an initial investment of P400,000. During 2020, he provided P800,000 worth of services to customers of which P200,000 were collected during January 2021. Expenses incurred amounted to P400,000 including P100,000 which were paid during January 2021. Mr. Wa Is withdrew P60,000 during 2020.How much should be the capital balance of Mr. Wa Is on December 31,2020 under the cash basis of accounting? *A. P640,000B. P740,000C. P800,000D. P840,000E. answer not givenTasa Incorporated after having experienced financial difficulties in 2021, negotiated with a major creditor and arrived at an agreement to restructure a note payable on December 31, 2021. The creditor was owed a principal of P3,600,000 and interest of P400,000 but agreed to accept equipment worth 850,000 and a note receivable from Tasa's customer with carrying amount of P2,700,000. The equipment had an original cost of P900,000 and an accumulated depreciation of 300,000. a.What amount should be recognized as gain from extinguishment of debt on December 31, 2021?
- John Industries collected $105000 from customers in 2020. Of the amount collected, $24700 was for services performed in 2019. In addition, John performed services worth $39400 in 2020, which will not be collected until 2021. John Industries also paid $71200 for expenses in 2020. Of the amount paid, $29600 was expenses incurred on account in 2019. In addition, John incurred $41400 of expenses in 2020, which will not be paid until 2021. Compute 2020 cash-basis net income.Isaac Inc. began operations in January 2021. For some property sales, Isaac recognizes income in the period of sale for financial reporting purposes. However, for income tax purposes, Isaac recognizes income when it collects cash from the buyer's installment payments. In 2021, Isaac had $676 million in sales of this type. Scheduled collections for these sales are as follows: 2021 $ 83 million 2022 137 million 2023 129 million 2024 162 million 2025 165 million $ 676 million Assume that Isaac has a 25% income tax rate and that there were no other differences in income for financial statement and tax purposes. Ignoring operating expenses, what deferred tax liability would Isaac report in its year-end 2021 balance sheet?On January 1, 2015, Crane Company purchased a P4,000,000 ordinary life insurance policy on its president. Additional data for the year 1028 are: Cash surrender value, January 1, P200,000; Cash surrender value, December 31, P220,000; Annual insurance premium paid on January 1, 2018, P80,000; Dividend received August 1, P10,000. Crane Company is the beneficiary under the life insurance policy. Crane should report life insuranceexpense for 2018 of _______________.
- Faith D. Nakpil started her accounting practice on November 3, 2021 by investing P138,000 cash and her old laptop with an original cost of P64,000 but with a fair value of P31,000 at the time of investment. How much was the initial capital of Faith?In 2018, KIKO Company purchased P5,000,000 life insurance policy on its president and chief executive officer, of which KIKO Company is the beneficiary. Information regarding this policy for 2021 is as follows: Cash surrender value, January 1 P100,000 Annual premium paid on Jnauary 1 200,000 Dividends earned on the policy 20,000 The dividends were applied to increase the cash surrender value. If the life insurance expense reported by KIKO Company in 2021 was P160,000, what is the cash surrender value on December 31?Robin Corp. had the following in 2020: Taxable Income: $330,000 Federal income tax: $69,300 Interest on state gov’t (muni) bond: $5,000 Interest on corporate bond: $10,000 Meals expense (total): $3,000 Key person life insurance premiums: $3,500 Key person life insurance proceeds: $130,000 Ordinary & necessary business expenses $250,000 Dividends (from a less-than-20%-owned US corp.): $35,000 What is Robin Corp.’s current E&P? Assume that there is no cash surrender value on the life insurance policy?