ReSA - THE REVIEW SCHOOL OF ACCOUNTANCY

CPA Review Batch 42 Ÿ October 2021 CPA Licensure Exam Ÿ Quiz 2

AUDITING (Auditing Problems) S. Ireneo Ÿ C. Espenilla

AP-200Q: ERROR CORRECTION, ACCOUNTING CHANGES,

CASH/ACCRUAL; SINGLE ENTRY
AP-200Q: Problem 1
You were assigned to audit the financial statements of Charlie Corp. as of and for the period ended
December 31, 2020. This is the first time Charlie Corp.’s financial statements are being audited since
it started operations in 2018. The following summarizes your audit findings:

a. The following is an analysis of the company’s accumulated profits account:

Date Particulars Debit Credit Balance
12/31/15 2018 Net loss 200,000 (200,000)
12/31/16 2019 Net Income 600,000 400,000
1/31/17 Payment of dividends 300,000 100,000
12/31/17 2020 Net Income 900,000 1,000,000

b. No dividends were declared in 2018. Dividends declared in December 2019 and 2020 were
paid on January of the following years. The 2020 dividends were at P500,000.

c. The following items were omitted at each year end:

2018 2019 2020
Accrued salaries P50,000 P90,000 P120,000
Unused supplies 30,000 - 25,000
Unearned rent income - 20,000 40,000

d. A three-year fire insurance amounting to P180,000 was paid and recognized as expense on
June 30, 2018. The insurance however covers the period July 1, 2018 to June 30, 2021.

e. An equipment with a cost of P400,000 was fully expensed in September 30, 2018. Based on
your discussions with the management, the cost should have been capitalized and depreciated
using straight-line method over its eight-year useful life.

Requirements:
1. What is the adjusted net income in 2018?
a. 317,500 c. 280,000
b. 167,500 d. 457,500
2. What is the adjusted net income in 2020?
a. 825,000 c. 765,000
b. 805,000 d. 725,000
3. What is the retroactive adjustment to the retained earnings beginning 2020?
a. 417,500 c. 17,500
b. 317,500 d. 92,500
4. What is the adjusted retained earnings on December 31, 2020?
a. 682,500 c. 1,152,500
b. 652,500 d. 1,182,500
5. What is the effect of the errors in 2020 working capital?
a. 105,000 c. 485,000
b. 635,000 d. 605,000

AP-200Q: Problem 2
You were assigned to audit for the first the time the financial statements of Baby Inc. as of and for the
year ended December 31, 2020. Baby Inc. is a merchandiser of office and school supplies and has
started operations in early 2018. No audit has been made on its financial statements from its
inception. The following was as a result of your audit investigations:

The retained earnings general ledger entries from 2018 to current year appears below:
Date Particulars Debit Credit Balance
12/31/15 Net Income P600,000 P600,000
7/1/16 Land donated by a 400,000 1,000,000
stockholder at fair value
12/31/16 Net Income 750,000 1,750,000
4/2/17 Loss on inventory due to P50,000 1,700,000
flood
12/31/17 Net Income 300,000 2,000,000

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Audit notes:
a. The following were omitted at each year end:
2018 2019 2020
Accrued operating expenses P90,000 P110,000 P98,000
Accrued rental income 40,000 45,000 50,000
Prepaid advertising expense 20,000 30,000 35,000

b. The following equipment acquisitions were erroneously charged to repairs and maintenance
expense account each year. It is the company’s policy to depreciated equipment using
straight-line method over 5 years. Moreover, full years depreciation is charged on the year of
acquisition, none on the year of disposal.
2018 2020
Equipment acquisitions charged to P400,000 P550,000
repairs and maintenance expense

c. Cash dividends declared and paid for each year were charged to other operating expenses.
2018 2019 2020
Dividends declared and paid P100,000 P150,000 P200,000

Requirements:
6. What is the correct net income in 2018?
a. 890,000 b. 850,000 c. 990,000 d. 950,000

7. What is the correct net income in 2020?

a. 882,000 b. 832,000 c. 682,000 d. 632,000

8. What is the retroactive adjustment to the retained earning beginning balance in 2020?
a. 250,000 credit b. 150,000 credit c. 125,000 debit d. 195,000 debit

9. What is the adjusted retained earnings at the end of 2020?

a. 2,187,000 b. 2,227,000 c. 2,287,000 d. 2,587,000

10. What is the effect of errors to the 2020 working capital?

a. 13,000 overstated c. 25,000 understated
b. 15,000 understated d. 23,000 overstated

AP-200Q: Problem 3
Casio Company keeps its records under the cash basis of accounting. You were asked to prepare its
financial statements under the accrual basis as a requirement of a loan application with a bank. The
following information were made available to you:
Total collections from customers P800,000
Total payments to suppliers of merchandise 420,000
Total payments to employees for salaries 200,000
Total payments for rentals 140,000
Total customer returns including a P30,000 cash refund 90,000
Total purchase returns including a P20,000 cash refund 100,000
Recoveries of previously written off accounts 10,000
Audit notes:
a. Outstanding customer invoices were at P150,000 and P225,000 at the beginning and at the
end of the year, respectively. P5,000 of the outstanding invoice at the beginning of the year is
doubtful of collection while P25,000 is doubtful at the end of the year.

b. Outstanding suppliers’ invoices were at P95,000 and P80,000 at the beginning and at the end
of the year, respectively.

c. Unsold merchandise inventory were at P55,000 and P85,000 at the beginning and at the end
of the year, respectively.

d. Unpaid employee’s salaries were at P30,000 and P25,000 at the beginning and at the end of
the year, respectively.

e. The unexpired portion of rent at the end of the year was at P25,000.

Requirements:

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11. What is the accrual basis gross sales?

a. 955,000 c. 865,000
b. 925,000 d. 965,000
12. What is the accrual basis gross purchases?
a. 505,000 c. 425,000
b. 485,000 d. 405,000
13. What is the accrual basis cost of goods sold?
a. 435,000 c. 355,000
b. 415,000 d. 375,000
14. What is the accrual basis salaries expense?
a. 225,000 c. 195,000
b. 200,000 d. 170,000
15. What is the accrual basis net income?
a. 160,000 c. 150,000
b. 170,000 d. 140,000

AP-200Q: Problem 4
You were engaged for the first time audit of the financial statements of Frank Corp., as of and for the
period ended December 31, 2020. The company, which started operations at the beginning of 2018 is
in the business of textile distribution. Your examination of the company’s books revealed the
following:

A. The company reported net income amounting to P568,200, P814,900 and P625,300 for 2018,
2019 and 2020 respectively.

B. The following accruals and deferrals were consistently omitted at the end of each year:
2018 2019 2020
Accrued utilities expense 5,000 9,000 2,000
Prepaid rent expense 2,500 1,200 1,600
Accrued salaries expense 9,000 2,000 1,500

C. The following deliveries were made to customers at each year-end, but were recorded as sales
only upon cash collection the following year. All sales were made FOB Shipping Point and the
related inventories were excluded from the physical count conducted every December 31:
2018 2019 2020
Sales price 25,000 20,000 34,000
Cost of goods 15,000 12,000 20,400

D. The following goods were received from suppliers as of each year-end, but were recorded as
purchases only upon cash payment the following year. All purchases were made FOB
Destination and the related inventories were included in the physical count since they were
already on hand as of the count date.
2018 2019 2020
Purchase price 25,000 22,000 24,000

E. You discovered that minor repairs done on the company’s warehouse costing P112,500 at the
beginning of 2019 was charged to the warehouse account and was depreciated over the
remaining life of the warehouse which was 9 years.

Requirements:
16. What is the adjusted net income for 2018?
a. 556,700 c. 541,700
b. 561,700 d. 581,700
17. What is the adjusted net income for 2019?
a. 714,600 c. 711,600
b. 709,600 d. 717,600
18. What is the adjusted net income for 2020?
a. 649,300 c. 657,700
b. 659,700 d. 661,300
19. What is the retroactive adjustment to the retained earnings beginning 2020?
a. (123,800) c. (111,800)
b. (89,800) d. (99,300)
20. What is the effect of the errors to the 2020 working capital?
a. 32,100 understated c. 16,200 overstated
b. 8,100 understated d. 12,300 overstated

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AP-200Q: Problem 5

You are assigned to audit the financial statements of Rhea Corp. for the first time for the period ended
December 31, 2020. In line with your audit, the following information were made available:

a. A collection for rental amounting to P45,000 of one of its idle properties covering the period
July 1, 2019 to June 30, 2020 was received and recorded as rent income in in July 1, 2019.

b. The following were consistently omitted at each year end.

2018 2019 2020
Salaries payable 5,500 3,600 9,900
Unused office supplies 5,400 9,000 6,100
Accrued royalty income 4,000 7,900 5,400

c. The following deliveries were made to customers at each year-end, but were recorded as sales
only upon cash collection the following year. All sales were made FOB Shipping Point and the
related inventories were included in the physical count conducted every December 31:
2018 2019 2020
Sales price 28,000 30,000 22,000
Cost of goods 15,400 17,400 13,200

d. A major repair cost improving the operating efficiency of an equipment was incurred at the
beginning of 2018. The cost amounting to P55,000 was recognized as an outright repairs and
maintenance expense. The equipment was acquired on January 2014 with a total useful life of
15 years.

e. Dividend amounting to P120,000 was declared on December 20, 2020 to stockholders as of

the same date and were recorded upon payment the following year January 20, 2021.

f. The general ledger of the company’s accumulated profits account contained the following
information:
Date Particulars Debit Credit
1/1/18 Balance 625,400
1/3/18 Excess over par for ordinary shares issued 120,000
12/31/18 Net loss for the year 177,400
1/5/19 FMV of land donated by a majority stockholder 480,000
12/31/19 Net income for the year 214,300
1/3/20 Cash dividend payment, declared in 12/20/19 90,000
12/30/20 Loss on sale of an equipment 22,500
12/31/20 Net income for the year 421,700
12/31/20 Balance 1,571,500

Requirements:
21. What is the adjusted net loss for 2018?
a. (95,900) c. (95,500)
b. (110,900) d. (115,900)
22. What is the adjusted net income for 2019?
a. 218,700 c. 191,200
b. 198,200 d. 196,200
23. What is the adjusted net income for 2020?
a. 423,700 c. 406,200
b. 419,500 d. 401,200
24. What is the correct retained earnings ending balance 2020?
a. 901,900 c. 1,021,900
b. 924,400 d. 956,900
25. What is the effect of the errors to the 2020 working capital?
a. 109,600 overstated c. 10,400 understated
b. 96,500 overstated d. 23,600 understated

AP-200Q: Problem 6
You are auditing the financial statements of Adelaida Inc. for the year ended December 31, 2020. The
company only maintain cash receipt and cash disbursement journals and records transactions under
cash basis.

The following summarizes your audit findings:

a. Cash records show the following information:

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CASH DISBURSEMENTS
Payments to suppliers P7,063,200
Payments of operating expenses 3,757,500
Cash refund to customers for sales returns 568,500

CASH RECEIPTS
Collections from customers, excluding recoveries of P16,216,800
previous write offs
Collections of royalty income 1,397,700
Collections of previously written-off outstanding invoices 457,500
Cash refund from suppliers for purchase returns 299,400

b. The following information are relevant regarding the company’s operating expenses and other
income:
Dec. 31,2020 Dec. 31,2019
Accrued operating expenses P1,863,900 P1,288,800
Prepaid operating expenses 295,500 630,300
Unearned royalty income 162,300 203,700

c. Receivables from customers, based on outstanding invoices at the beginning of the year is at
P3,751,500 while receivables from customers at the end of the year was at P2,837,100.
P735,900 of the uncollected invoices were written off during the year while P457,500 of the
previously written-off invoices were collected. Customers took advantage of a total of
P712,500 sales discount during the year while sales returns from customers for the year was
at P1,275,600 including the refunds made to the customers. Advance collections from
customers as of December 31, 2020 for merchandise to be delivered in 2021 was at
P1,246,800.

d. P704,400 of the outstanding invoices at the beginning of the year is doubtful of collection
while P589,500 of the outstanding invoices at the end of the year is doubtful of collection.

e. Payables to suppliers of merchandise, based on outstanding supplier invoices at the beginning

of the year was at P1,799,100 while payables to suppliers at the end of the year was at
P2,628,300. Purchase discounts for the year was at P707,400 while purchase returns for the
year was at P946,200 which included refunds from the suppliers.

f. Unsold merchandise on hand at the beginning and at the end of the year were at P1,962,900
and P2,425,200, respectively.

g. The company had two delivery vehicles acquired at the beginning of 2018 at P4,200,000 each.
The company estimates that the trucks have a useful life of 15 years from date of purchase
and will have a 10% salvage value based on cost. No depreciation has been provided on the
vehicles under the cash basis records.

Requirements:
26. What is the correct accrual basis gross sales for the year?
a. 16,211,100 c. 17,459,400
b. 16,779,600 d. 14,223,000
27. What is the correct accrual basis cost of sales for the year?
a. 7,130,700 c. 7,593,000
b. 9,246,600 d. 7,430,100
28. What is the accrual basis operating expense for the year (except depreciation and bad debt
expense)?
a. 4,667,400 c. 4,037,100
b. 4,962,900 d. 2,847,600
29. What is the bad debt expense for the year?
a. 393,300 c. 339,300
b. 136,500 d. 163,500
30. What is the accrual basis royalty income for the year?
a. 1,356,300 c. 1,349,100
b. 1,546,300 d. 1,439,100
31. What is the correct net income for the year?
a. 3,196,500 c. 3,140,500
b. 3,360,000 d. 3,465,600

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AP-200Q: Problem 7
You have been engaged to audit the accounts of Garcia Company for the first time in 2020. The
company started operations in 2018. During the audit you discovered the following information:

Year ending December 31,

2018 2019 2020
a. Unadjusted Net Income P520,000 P580,000 P710,000
b. Ending inventory overstated as a
result of over counting items at 50,000 40,000
year-end.
c. Ending inventory understated as a
result of wrong pricing and 14,000 8,000
computational errors
d. Delivery of merchandise to customers
at year-end recorded as sales only
upon collection the following year 25,000 22,000
e. Receipt of merchandise from suppliers
at year-end recorded as purchases
only upon payment the following year 12,000 10,000
f. Major repairs on equipment at the
beginning of each year, charged to
repairs expense but should have been
capitalized. Annual depr. is 10%. 240,000

Additional information:
• An equipment with an original cost of P200,000 and an accumulated depreciation of P120,000
as of December 31, 2020 was sold for P100,000 on December 31, 2020. The amount
collected was credited to miscellaneous income.
• A 10%, P1,000,000, 5-year bonds payable was issued on January 1, 2020. Interest on the
bonds is payable annually. The yield rate on the bonds on the issuance date was at 8%. The
company recorded the transaction as a debit to cash (based on the 8% yield rate) a credit to
bonds payable at face value with the difference being charged against the interest expense
account. The only other entry made by the client was the payment of the interest at year-end.
• Dividends declared by the company at each year end but were recorded only upon payment
the following year were: P90,000, P120,000 and P150,000 for 2018, 2019 and 2020,
respectively.

Requirements: Determine the adjusted balances of:

32. 2018 Net income
a. 470,000 c. 445,000
b. 495,000 d. 595,000
33. 2019 Net income
a. 869,000 c. 820,000
b. 845,000 d. 855,000
34. 2020 Net income
a. 473,757 c. 453,612
b. 606,243 d. 460,146
35. Retroactive adjustment to the retained earnings beginning 2020?
a. 240,000 credit c. 24,000 credit
b. 120,000 credit d. 120,000 debit
36. What is the correct carrying value of the bonds payable as of December 31, 2020?
a. 1,079,854 c. 1,066,243
b. 1,051,542 d. 1,000,000

AP-200Q: Problem 8
You were assigned to audit the financial statements of Fritzie Corp. as of and for the period ended
December 31, 2020. This is the first time Fritzie Corp.’s financial statements are being audited since it
started operations in 2018. The following summarizes your audit findings:

a. The following is an analysis of the company’s accumulated profits account:

Date Particulars Debit Credit Balance
12/31/18 2018 Net loss 140,000 (140,000)
12/31/19 2019 Net Income 690,000 550,000
1/31/20 Payment of dividends 300,000 250,000
12/31/20 2020 Net Income 925,000 1,175,000

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b. No dividends were declared in 2018. Dividends declared in December 2019 and 2020 were
paid on January of the following years. The 2020 dividends were at P500,000.

c. The following items were omitted at each year end:

2018 2019 2020
Unearned royalty income P50,000 P40,000 P20,000
Prepaid advertising expense 30,000 - 25,000
Accrued utilities - 20,000 40,000

d. A three-year fire insurance amounting to P90,000 was paid and recognized as expense on
June 30, 2018. The insurance however covers the period July 1, 2018 to June 30, 2021.

e. An equipment with a cost of P240,000 was fully expensed in September 30, 2018. Based on
your discussions with the management, the cost should have been capitalized and depreciated
using straight-line method over its eight-year useful life.

Requirements:
37. What is the adjusted net income in 2018?
a. 317,500 c. 280,000
b. 147,500 d. 455,500
38. What is the adjusted net income in 2020?
a. 825,000 c. 890,000
b. 805,000 d. 895,000
39. What is the retroactive adjustment to the retained earnings beginning 2020?
a. 417,500 c. 112,500
b. 317,500 d. 92,500
40. What is the adjusted retained earnings on December 31, 2020?
a. 827,500 c. 952,500
b. 852,500 d. 982,500
41. What is the effect of the errors in 2020 working capital?
a. 20,000 over c. 520,000 under
b. 20,000 under d. 520,000 over

AP-200Q: Problem 9
You were assigned to audit for the first the time the financial statements of Debie Inc. as of and for
the year ended December 31, 2020. Debie Inc. is a distributor of a major clothing line in the
Philippines and has started operations in early 2018 when 200,000 shares of its P10 par value
ordinary shares were issued at par value. No audit has been made on its financial statements from its
inception. The following information were gathered as a result of your audit investigations:

The retained earnings general ledger entries from 2018 to current year appears below:
Date Particulars Debit Credit Balance
7/1/ Fair value of a Land donated by a P950,000 P950,000
2018 majority stockholder
12/31 Net Income 1,928,000 2,878,000
2/3/ Excess over par value of additional 550,000 3,428,000
2019 50,000 shares issued at P21 per
share
6/31/ 20% Stock dividend declaration, 1,100,000 2,328,000
fair value of shares on this date
was at P22 per share
12/31 Net Income 2,124,000 4,452,000
8/2/ Loss on inventory due to flood 125,000 4,327,000
2020
12/31/ Net Income 1,760,000 6,087,000

Audit notes:
a. The following were omitted at each year end:
2018 2019 2020
Prepaid rent expenses P95,000 - P48,000
Accrued advertising expense - P50,000 35,000
Accrued rent income 80,000 40,000 -

b. Collections from customers at each year-end for goods delivered the following year, were
recorded as sales upon cash receipt. Good were not physically included in each year-end
count.
2018 2019 2020

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Selling price P150,000 P190,000 P120,000

Cost of inventories 90,000 114,000 72,000

c. The following equipment acquisitions were erroneously charged to repairs and maintenance
expense account each year. It is the company’s policy to depreciated equipment using
straight-line method over 5 years. Moreover, full years depreciation is charged on the year of
acquisition, none on the year of disposal.
2018 2020
Equipment acquisitions charged to repairs and P400,000 P550,000
maintenance expense

d. The company declared a P2 dividend per share on December 30, 2018 to be paid on January
25 of the following year. The said dividend declaration is yet to be recorded.

Requirements:
42. What is the correct net income in 2018?
a. 2,483,000 c. 2,363,000
b. 2,443,000 d. 2,236,000
43. What is the correct net income in 2020?
a. 1,990,000 c. 2,171,000
b. 2,021,000 d. 2,046,000
44. What is the adjusted retained earnings balance as of December 31, 2019?
a. 3,706,000 c. 3,806,000
b. 3,606,000 d. 3,106,000
45. What is the correct debit to retained earnings for the cash dividend declaration in 2020?
a. 500,000 c. 600,000
b. 550,000 d. 650,000
46. What is the effect of errors to the 2020 working capital?
a. 35,000 understated c. 61,000 understated
b. 35,000 overstated d. 635,000 overstated

AP-200Q: Problem 10
You were engaged to audit, for the first time, the financial statements of Lou Corporation for the period
ended December 31, 2020. The company which is into the distribution of construction materials and
supplies in various locations in the Central Luzon and Southern Luzon and has started its operations in
2018.

a. The unadjusted net income were as follows:

2018 P1,089,000
2019 982,000
2020 1,123,000

b. Accrued salaries expense at the end of the following years were consistently omitted:
December 31, 2018 P86,000
December 31, 2019 55,000
December 31, 2020 75,000

c. Office and store supplies are recognized as expense when paid. The following inventory of unused
supplies however existed as of the end of each year:
December 31, 2019 102,000
December 31, 2020 79,000

d. The following are the recorded invoice prices of construction materials and supplies in-transit to
customers by the end of each year. The goods were excluded from the year-end inventory count.
Gross profit margin is at 40% based on sales with a term FOB Destination.
December 31, 2018 P150,000
December 31, 2020 180,000

e. The following advanced payments to suppliers at the end of each year were recorded in the
purchases journal upon payment. Goods for the said advances however were only received the
following year.
December 31, 2019 P105,000
December 31, 2020 122,000

f. A major overhaul was done on one of the company’s delivery trucks at the beginning of 2019. The
overhaul did not extend the truck’s remaining life which was 3 years but it improved the truck’s
operating efficiency and safety. The overhaul cost P150,000 and was charged by the company to
repairs and maintenance expense upon incurrence.

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g. A three-year rent covering three years amounting to P180,000 for a warehouse being rented out in
Pampanga was collected in advance on June 30, 2018. The entire amount was recognized as income
upon receipt.

Requirements:
47. The correct 2018 net income is:
a. 823,000 c. 853,000
b. 883,000 d. 793,000
48. The correct 2019 net income is:
a. 1,380,000 c. 1,110,000
b. 1,440,000 d. 1,320,000
49. The corrected 2020 net income is:
a. 915,000 c. 1,179,000
b. 975,000 d. 1,035,000
50. The restrospective adjustment to retained earnings as a result of your audit in 2020 shall be:
a. 162,000 c. 192,000
b. 132,000 d. 74,000
51. The effect of the errors on 2020 total assets is:
a. 129,000 c. 7,000
b. 179,000 d. 57,000

AP-200Q: Problem 11
You were engaged to audit the financial statements Nine Ball Corporation in relation to its application
for a bank loan. Nine Ball Corporation maintains accounting records under cash-basis accounting. The
following were discovered in line with your investigations:

a. Summary of cash transactions were as follows:

CASH RECEIPTS:
Collections from customers 28,950,000
Interest on notes receivable 260,000
Purchase returns 180,000
Sale of an equipment 280,000

CASH DISBURSEMENTS:
Payments to suppliers of merchandise 17,590,000
Sales returns 190,000
Rent 766,000
Salaries 7,856,000
Equipment 850,000
Miscellaneous expenses 345,000
Dividends 1,000,000

b. The following changes in account balances would have been observed had accrual basis been
used.
INCREASES
Cash 4,200,000
Accounts receivable 1,980,000
Accounts payable 970,000
Advances to suppliers 523,000
Prepaid rent 140,000
Accumulated depreciation 150,000
Allowance for bad debt 226,000

DECREASES
Interest receivable 60,000
Equipment 100,000
Notes receivable - trade 600,000
Accrued salaries expense 300,000
Inventory 1,146,000

c. Additional information:
• Total purchase returns and allowances amounted to P350,000 (including the refunded
portion) while the total sales returns and allowances amounted to P480,000 (including
the refunded portion).

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ReSA – THE REVIEW SCHOOL OF ACCOUNTANCY AP-200Q
Quiz2: ERROR CORRECTION, ACCOUNTING CHANGES, CASH/ACCRUAL;SINGLE ENTRY

• Total sales discounts and purchases discounts were at P415,000 and P394,000
respectively.

• Receivables amounting to P248,000 were written off during the year, while a P94,000
recovery from previous write-off was made.

• The equipment sold during the year had a carrying value of P360,000 on the date of
sale.

Required: Determine the audited balances of the following:

52. Net sales

a. 30,484,000 c. 30,294,000
b. 31,189,000 d. 30,578,000

53. Net purchases

a. 18,037,000 c. 18,903,000
b. 17,857,000 d. 18,601,000

54. Cost of sales

a. 19,003,000 c. 20,049,000
b. 19,183,000 d. 19,747,000

55. Depreciation expense

a. 440,000 c. 740,000
b. 590,000 d. 640,000

56. Bad debt expense

a. 72,000 c. 340,000
b. 226,000 d. 380,000

57. Salaries expense

a. 7,856,000 c. 7,556,000
b. 8,156,000 d. 7,665,000

58. Net income

a. 1,844,000 c. 1,764,000
b. 1,884,000 d. 1,674,000

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