Century 21 Accounting Multicolumn Journal
11th Edition
ISBN:9781337679503
Author:Gilbertson
Publisher:Gilbertson
Chapter22: End-of-fiscal-period Work For A Corporation
Section: Chapter Questions
Problem 2AP
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May I ask for a solution and explanation to the problem for a better understanding. Thank you!
17. How much is the working capital for Bittergourd Company?
a. 10,000
b. 15,000
c. 20,000
d. 25,000
Transcribed Image Text:BITTERGOURD Company
Income Statement
For the Year Ended December 31, 2014
(in thousands of pesos)
P 2,000
(1,400)
P 600
(240)
Р 360
(50)
P 310
(93)
P 217
Sales (all on account).
Cost of goods sold..
Gross margin..
Operating expenses..
Net operating income..
Interest expense.
Net income before taxes.
Income taxes (30%)..
Net income.
BITTERGOURD Company
Statement of Financial Position
December 31, 2014 and 2013
(in thousands of pesos)
Assets
2014
2013
Current assets:
Р 140
Р 130
Cash and Cash equivalents..
Accounts receivable, net.
120
110
110
Inventory..
Prepaid expenses.
100
50
40
Total current assets.
P 410
P 390
Noncurrent assets:
Plant & equipment, net.
1,840
1,830
Total assets..
P2,250
P2,220
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable.
P 100
P 100
Accrued liabilities.
Notes payable, short term.
80
80
210
P 390
230
Total current liabilities..
P 410
Noncurrent liabilities:
Bonds payable .
460
500
Total liabilities .
P 850
P 910
Shareholders' equity:
Preference share capital,P5 par, 5%.
Ordinary share capital, P10 par
Share premium - ordinary..
Accumulated profits.
Total shareholders' equity..
Total liabilities & shareholders' equity.
Р 100
P 100
200
200
260
260
840
750
P1,400
P2,250
P1,310
P2,220
Dividends during 2014 totaled P127,000, of which P5,000 were preference dividends. The market price of an
ordinary share on December 31, 2014 was P140.
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