AP-5902_liabs - PROBLEM NO 1 Heats Corporation Requirement...

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Requirement no. 1 Notes payable: Arising from purchase of goods 304,000 Arising from bank loans, on which marketable securities valued at P600,000 have pledged as security, due Dec. 31, 2005 500,000 Arising from advances by officers, due June 30, 2005 50,000 Employees’ income tax withheld 20,000 Advances received from customers on purchase orders 64,000 Containers’ deposit 50,000 Accounts payable arising from purchase of goods (P170,000 + P30,000) 200,000 Customers' account with credit balance 40,000 Cash dividends payable 80,000 Current portion of serial bonds (P50,000 x 2) 100,000 Overdraft with Allied Bank 90,000 Est. damages to be paid as a result of unsatisfactory performance on a contract 160,000 Est. expenses on meeting guarantee for service requirements on mechandise sold 120,000 Estimated premiums payable 75,000 Deferred revenue 87,000 Accrued interest on bonds payable 360,000 Provision - deficiency income tax assessment 200,000 TOTAL CURRENT LIABILITIES 2,500,000 A Convertible bonds, due January 31, 2007 1,000,000 Noncurrent portion of serial bonds (P2,000,000 - P100,000) 1,900,000 TOTAL NONCURRENT LIABILITIES 2,900,000 B 5,400,000 C Item no. 2 Insurance expense (P24,000/12 x 1/2) 1,000 Prepaid insurance 1,000 Item no. 6 Prepaid dues and subscription 5,000 Dues and subscription exp 5,000 Item no. 8 Vouchers payable 111,500 Inventory 111,500 Item no.10 Legal and professional expense 46,000 Vouchers payable 46,000 Item no.11 Medical expense 25,000 Vouchers payable 25,000 Item no.12 Inventory 55,000 Vouchers payable 55,000 Item no.19 Machinery and equipment 254,000 Vouchers payable 254,000 PROBLEM NO. 1 - Heats Corporation TOTAL LIABILITIES (Requirement no. 2) PROBLEM NO. 3 - Pistons Company
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1 Accounts payable per general ledger 5,440,000 Debit balances in suppliers' accounts 240,000 Goods in transit on 12/31/05, FOB shipping point 192,000 Unrecorded purchase return (160,000) Adjusted accounts payable 5,712,000 Accrued janitorial expenses (P144,000 x 2/3) 96,000 Accrued utilities (P67,200 x 15/30) 33,600 Total 5,841,600 D 2 Accrued salaries and wages 776,000 Income taxes withheld 56,000 SSS contributions payable 64,000 Philhealth contributions 16,000 Total
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