58 Cake Corporation (CC), at the start of its fiscal year, received a Php21,001,400 subsidy from Ph Government to purchase equipment on March 31, 2020. The equipment cost is Php35,700,180 which is equally allocable within eight years with residual value of 6,957,820. The year generated Php8,603,900 revenue with corresponding salaries and administrative expenses of 5,481,345. If CC credited deferred revenue for the subsidy and amortize the grant venue over the equipment life, how much would be the net income at the end of its fiscal year operation? *
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- DPWH had the following transactions related to a construction project of school building worth P28,000,000 during the year 2021:January 25. Payment of mobilization fee equivalent to 15% of the contract price.March 10. Received 1st progress billing from the contractor equivalent to 40% completion of contract price.March 25. Paid the amount due to the contractor for the 1st progress billing. Deductions are: Recoupment of advances based on % of completion (deducted upon payment) Retention, 5% of the billings Withholding taxes (EWT & Final VAT) The entry to recognize the payment of mobilization fee includes a: a. Debit to Advances to Contractors, P4,200,000 b. Debit to Advances to Officers and Employees, P4,200,000 c. Debit to Accounts Receivable, P4,200,000 d. Debit to Advances to SDO, P4,200,000Assume Avaya contracted to provide a customer with Internet infrastructure for $2,200,000. The project began in 2024 and was completed in 2025. Data relating to the contract are summarized below: Costs incurred during the year Estimated costs to complete as of 12/31 Billings during the year Cash collections during the year Required: 1. Compute the amount of revenue and gross profit or loss to be recognized in 2024 and 2025, assuming Avaya recognizes revenue over time according to percentage of completion. 2. Compute the amount of revenue and gross profit or loss to be recognized in 2024 and 2025, assuming this project does not qualify for revenue recognition over time. 3. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2024, assuming Avaya recognizes revenue over time according to percentage of completion. 4. Prepare a partial balance sheet to show how the information related to this contract would be presented at…Assume Avaya contracted to provide a customer with Internet infrastructure for $2,200,000. The project began in 2024 and was completed in 2025. Data relating to the contract are summarized below: Costs incurred during the year Estimated costs to complete as of 12/31 Billings during the year Cash collections during the year Required: 1. Compute the amount of revenue and gross profit or loss to be recognized in 2024 and 2025, assuming Avaya recognizes revenue over time according to percentage of completion. 2. Compute the amount of revenue and gross profit or loss to be recognized in 2024 and 2025, assuming this project does not qualify for revenue recognition over time. 3. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2024, assuming Avaya recognizes revenue over time according to percentage of completion. 4. Prepare a partial balance sheet to show how the information related to this contract would be presented at…
- Assume Avaya contracted to provide a customer with Internet infrastructure for $2,200,000. The project began in 2024 and was completed in 2025. Data relating to the contract are summarized below: Costs incurred during the year Estimated costs to complete as of 12/31 Billings during the year Cash collections during the year Required: 1. Compute the amount of revenue and gross profit or loss to be recognized in 2024 and 2025, assuming Avaya recognizes revenue over time according to percentage of completion. 2. Compute the amount of revenue and gross profit or loss to be recognized in 2024 and 2025, assuming this project does not qualify for revenue recognition over time. 3. Prepare a partial balance sheet to show how the information related to this contract would be presented at the end of 2024, assuming Avaya recognizes revenue over time according to percentage of completion. 4. Prepare a partial balance sheet to show how the information related to this contract would be presented at…In 20x1, Metallica Co. enters into a construction contract with a customer. The transaction price in the contract is ₱1,200,000. At contract inception, Metallica Co. estimates a total contract cost of ₱944,000. The actual costs incurred in 20x1 are ₱590,000. The estimated cost to complete on December 31, 20x1 is ₱410,000. Progress billings during the year amount to ₱70,000, ₱60,000 of which is collected. At contract inception, Metallica Co. determines that its performance obligation in the contract is a single performance obligation that is satisfied over time. Metallica Co. uses the cost-to-cost method to measure its progress in the contract. How much is the profit recognized in 20x1? a. 118,000 c. 122,000 b. 120,800 d. 132,200On February 14, 2020, Gerald Company established a sales agency in Secret Place.Upon establishment of the sales agency, the home office sent samples costing ₱8,000and a working fund of ₱3,000 to be maintained on the imprest basis. During the sixmonths period, the sales agency reported to the home office sales orders. These werebilled at ₱70,000 of which of ₱40,000 was collected. The sales agency paid expenses of₱5,800 but was reimbursed by the home office.On August 15, 2020, the sales agency samples were valued at ₱2,000. It was estimatedthat the gross profit on goods shipped to fill sales order averaged 40% of cost.The cost of sales of the sales agency for the six months period is:
- Jen Company had a 10% P1,000,000 specific construction loan and 12% P20,000,000 general loan outstanding during 2021. The entity began the self-construction of a building on January 1, 2021 and was completed on December 31, 2021. The following expenditures were made during 2021: January 1, 2021 1,000,000April 1, 2021 2,000,000December 1, 2021 3,000,0001) What is the cost of the building on December 31, 2021?Likes Company started construction of a low-rise building for its own use on January 1, 2021. Upon completion at December 31, 2021, construction costs totaled P21,500,000, which were incurred evenly during the construction period. Prior to the start of construction, Likes Company obtained a P10M, 12%, 5-year loan from ABC Bank to finance the project. During periods that construction costs were low, the company temporarily investment the proceeds and earned interest income of P50,000. In addition to the specific borrowing, prior to the construction, the company had a general borrowing amounting to P600,000 with interest of 15% and a four-year term that was used in part in the self construction?How much is the capitalized interest on the self-constructed building of Likes Company?Agency XYZ received from DBM allotment for capital outlay and NCA amounting to P15 million and P10 million respectively. 10% withholding tax is imposed on all government transaction. The agency purchased computers amounting to P500,000. Transportation cost amounting to P50,000 and installation cost worth P20,000 was incurred by the company. Purchase orders for tables and chairs amounting to P470,000 were sent out to suppliers. The agency also wanted to construct a new building with an estimated cost of P8 million. Interested constructors were invited for the bidding. REQUIRED: How much is the balance of Cash at the end of the period?
- In 20x1, Salamagi Co. entered into a contract with a customer. The contract stipulates the following: Contract price of ₱20,000,000 5% mobilization fee due upon signing of the contract, to be deducted from the final billing 10% customer retention on all subsequent progress billings, to be paid to Salamagi on completion of the project. Salamagi Co. estimated a ₱5,000,000 gross profit from the project. The percentage of completion method will be used. In 20x1, Salamagi billed the customer for 50% completion of the project. The customer accepted all the billings, except one for 10% which was accepted on January of the following year. All the accepted billings were collected during the year except an 8% billing which was due January of the following year. What is the amount of profit recognized from the contract in 20x1? 2,500,000 c. 2,720,000 2,650,000 d. 2,900,000 What is the total amount of collections from the billings in 20x1? 5,760,000 c. 6,760,000 6,400,000 d.…1.On December 5, 2021, the company purchased new machinery from Nine Bhd for $45,000.The new machinery, like the rest of the company's machinery, will be depreciated at 15% per year using the declining balance technique on a yearly basis. The new machinery, on the other hand, is expected to have a residual worth of $5,000. On that date, the company received a $20,000 government subsidy for the purchase of new machinery and paid the remaining balance by check. The company's policy is to adopt the net-off approach for accounting for government grants. 2. On September 1, 2021, Fern Bhd purchased a retail building for $180,000 in order to demonstrate and advertise its products. The marketing department immediately put the shop building to use. A further $20,000 had been spent on a small repair of the shop building by Fern Bhd. On September 1, 2021, the renovation will commence. However, because to a covid-19 case involving two of the renovation workers, the work was halted for two weeks.…In November 20X2, an entity contracts with a customer to refurbish a 3-storey building and install new elevators for a total consideration of ₱5,000,000. The promised refurbishment service, including the installation of elevators, is a single performance obligation satisfied over time. Total expected costs are ₱4,000,000, including ₱1,500,000 for the elevators. The entity determines that it acts as a principal because it obtains control of the elevators before they are transferred to the customer. A summary of the transaction price and expected costs is as follows: Transaction price ₱5,000,000 Expected costs: Elevators ₱1,500,000 Other costs 2,500,000 Total expected costs ₱4,000,000 The entity uses an input method based on costs incurred to measure its…