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Problem 1

The trial balance of Cielo Barney Co. as of December 31, 20X1 is presented. Assets total $10,930,000 including current assets of $4,760,000 such as cash, investments, receivables and inventory, and non-current assets of $6,170,000 including property, plant and equipment, investments and other assets. Liabilities total $4,630,000 including current liabilities of $3,990,000 such as payables, provisions and taxes, and non-current liabilities of $640,000 including deferred tax and interest payable. Equity is $6,300,000 comprising share capital, retained earnings and reserves. Notes to the

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117 views

Problem 1

The trial balance of Cielo Barney Co. as of December 31, 20X1 is presented. Assets total $10,930,000 including current assets of $4,760,000 such as cash, investments, receivables and inventory, and non-current assets of $6,170,000 including property, plant and equipment, investments and other assets. Liabilities total $4,630,000 including current liabilities of $3,990,000 such as payables, provisions and taxes, and non-current liabilities of $640,000 including deferred tax and interest payable. Equity is $6,300,000 comprising share capital, retained earnings and reserves. Notes to the

Uploaded by

Rio De Leon
Copyright
© © All Rights Reserved
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Problem 1

The trial balance of Cielo Barney Co. prepared as of December 31, 20x1 is shown below:

Debits Credits
Accounts payable 720,000.00
Accounts receivable 2,000,000.00
Accrued liabilities 80,000.00
Accumulated Depreciation - Building 700,000.00
Advances to employees 40,000.00
Advances to suppliers 30,000.00
Allowance for doubtful accounts 300,000.00
Building 3,400,000.00
Cash in bank 1,000,000.00
Cash on hand 60,000.00
Deferred tax liability 300,000.00
Discount on loan payable 740,000.00
Held for trading securities 800,000.00
Income tax payable 500,000.00
Interest payable (due in 20x2) 340,000.00
Inventories 1,200,000.00
Investment in equity securities - FVOCI 300,000.00
Investment property 900,000.00
Land 2,200,000.00
Loans payable 3,000,000.00
Ordinary share capital 4,000,000.00
Provision for probable loss on lawsuit 430,000.00
Retained earnings 1,640,000.00
Revaluation Surplus 90,000.00
Share premium 600,000.00
Translation loss on foreign operation 30,000.00
12,700,000.00 12,700,000.00

Requirement:
1. Prepare a Statement of Financial Position of Cielo Barney Co. Make a proper heading for the financial statement.
Apply the general feature of "materiality and aggregation."
2. Prepare notes nshowing the breakdown of line items in the financial statement. Make proper cross-referencing
of those notes; use "Notes 6" as your first cross-reference.

Cielo Barney Corporation


Statement of Financial Position
For the year ended December 31, 2020

Assets: Notes
Current Assets:
Cash and cash equivalent 6 1,060,000.00

held for trading securtiries 800,000.00


Trade and other receivables 7 1,700,000.00
Inventories 1,200,000.00 4,760,000.00
Total current liabilities

Noncurrent assets
Property plant and equipment 8 4,900,000.00
Long term investment 9 1,200,000.00
Other assets 10 70,000.00 6,170,000.00
Total non current assets 10,930,000.00
Total Assets

Liabilities
Trade and other payable 11 3,060,000.00
Current tax liability 500,000.00
Provision for probable loss on lawsuit 430,000.00
Total current liabilities 3,990,000.00

Noncurrent:
Deferred tax liability 300,000.00
Interest payable (due in 20x2) 340,000.00
Total non current liabilities 640,000.00
Total liabilities 4,630,000.00

Equity
Ordinary share capital 4,000,000.00
Retained earnings 1,640,000.00
Reserves 12 660,000.00
Total shareholders equity 6,300,000.00
Total liabilities and equity 10,930,000.00
al statement.

-referencing

Notes 6: Cash and Cash equivalent


Cash in bank 1,000,000.00
Cash on hand 60,000.00
Total cash and cash
equivalents 1,060,000.00

Notes 7: Trade and other receivables


Accounts receivable 2,000,000.00
Allowance for doubtful acc -300,000.00
Total tor 1,700,000.00

Notes 8 Property plant and equipment


Building 3,400,000.00
Land 2,200,000.00
Accumulated Depreciation - -700,000.00
Total 4,900,000.00

Notes 9 Long term investment


Investment in equity securi 300,000.00
Investment property 900,000.00
Total 1,200,000.00

Notes 10 Other assets


Advances to employees 40,000.00
Advances to suppliers 30,000.00
Total 70,000.00

Notes 11: Trade and other payable


Accounts payable 720,000.00
Accrued liabilities 80,000.00
Loans payable 3,000,000.00
Discount on loan payable -740,000.00
Total 3,060,000.00

Notes 12 : Reserves
Revaluation Surplus 90,000.00
Share premium 600,000.00
Translation loss on foreign -30,000.00
Total 660,000.00

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