FINAL EXAM IN AUDCON1 PROBLEM SOLVING PART 2 my students' copy REVISED 2022 December (1)

Part 2-Problem Solving. Questions 51 to 75 are based on the following independent situations from Problem 1 to 5. PROBLEM NO. 1: SNOW WHITE COMPANYSnow White Company began operations on January 1, 2021.The accountant prepared the following: Statement of Financial Position (Cash Basis) January 1, 2021 AssetsLiabilities and equity CashP 49,600Accounts payableP 28,000 Partsinventory24,000Share capital, P100 par265,600 Equipment220,000. Total assetsP293,600Total liabilities and equityP293,600 The company has developed plans to expand its business is in the process of negotiating a bank loan to finance the expansion.The bank is requesting 2021 financial statements prepared on the accrual basis of accounting. As the company'sexternal auditor, you were called upon to assist in preparing the financial statements.During the course of your engagement, you obtained the following information: Transactions for 2021 Cash salesP232,000 Collections from credit customers80,000 Payments on account for parts80,800 Wages paid to employees124,000 Payments to the utility company22,000 •Uncollected customers' bills totaled P69,800 at December 31, 2021. •On March 1, 2021, a supplier advanced the company P40,000 on a 1-year, 12% note payable with semiannual interest payments to be made on September 1, 2021 and at maturity on March 1, 2022. •Unpaid bills to suppliers totaled P11,200 at December 31, 2021. •Parts costing P8,000 were on hand at year-end. •Wages owed at year-end were P5,600. •Utility expense of P1,950 was unpaid at year-end. •The P18,000 insurance premium was paid for a 1-year policy effective February 1, 2021. •The rent of P3,000 was paid on the first day of every month. •The company's equipment, purchased at the time the company was founded, should be depreciated over its useful life of 10 years using straight-line depreciation with no residual value. •The effective tax rate is 40%.No taxes have been paid.QUESTIONS: Based on the above and the result of your engagement,you are asked to provide the following information underthe accrual basis: 51.The total sales for 2021 werea.P381,800c.P232,000b.P312,000d.P80,00052.The parts expense for 2021 wasa.P88,000c.P80,000b.P80,800d.P64,00053.The total expenses other than taxes in the single-step income statement was a.P339,950c.P304,500 b.P312,050d.P290,050 54.The net income for 2021 was a.P69,750c.P46,380 b.P55,050d.P41,850 55.The total cash available during 2021 was a.P401,600c.P232,000 b.P352,000d.P118,400 56.The ending cash balance was a.P283,200c.P118,400 b.P154,400d.P68,800 57.The total current assets at year-end equaled a.P220,000c.P197,700 b.P198,000d.P196,200 58.The total assets at year-end equaled a.P417,700c.P307,450 b.P395,700d.P197,700 PROBLEM NO. 2: TLL COMPANY The December 31, 2020 adjusted trial balance of TLL Company shows the following: DebitCredit Accounts receivableP50,000 Allowance for bad debtsP2,000 Additional information: •Cash sales of the company represents 10% of gross sales. •90% of the credit sales customers do not take advantage of the 2/10, n/30 terms. •It is expected that cash discount of P300 will be taken on accounts receivable outstanding at December 31, 2021. •Sales returns in 2021 amounted to P20,000.All returns were from charge sales. •During 2021, accounts totaling to P2,200 were written off as uncollectible; bad debt recoveries during the year amounted to P150. •The allowance for bad debts is adjusted so that it represents certain percentage of the outstanding accounts receivable at year end.The required percentage at December 31, 2021 is 150% of the rate used on December 31, 2020. QUESTIONS: Based on the above and the result of your audit, determine the following: 59.The accounts receivable as of December 31, 2021 is a.P150,000c.P16,667 b.P122,200d.P15,000 60.The allowance for doubtful accounts as of December 31, 2021 is a.P1,000c.P9,000 b.P6,000d.P7,332 61.The net realizable value of accounts receivable as of December 31, 2021 is a.P15,367c.P143,700 b.P140,700d.P114,568