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    Ia3 22 23

    Uploaded by

    Gabriel Trinidad Soniel
    - The document presents restated financial statements for 2019 and 2020 adjusting for changes in the purchasing power of the local currency. - Items like cash, inventory, equipment, and liabilities were restated using currency conversion fractions to adjust for inflation. - A gain on purchasing power is recognized for 2020 to account for the decrease in purchasing power over that year.

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    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd

    Ia3 22 23

    Uploaded by

    Gabriel Trinidad Soniel
    42 views5 pages
    - The document presents restated financial statements for 2019 and 2020 adjusting for changes in the purchasing power of the local currency. - Items like cash, inventory, equipment, and liabilities were restated using currency conversion fractions to adjust for inflation. - A gain on purchasing power is recognized for 2020 to account for the decrease in purchasing power over that year.

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    IA3 22 23

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    - The document presents restated financial statements for 2019 and 2020 adjusting for changes in the purchasing power of the local currency. - Items like cash, inventory, equipment, and liabilities were restated using currency conversion fractions to adjust for inflation. - A gain on purchasing power is recognized for 2020 to account for the decrease in purchasing power over that year.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    42 views5 pages

    Ia3 22 23

    Uploaded by

    Gabriel Trinidad Soniel
    - The document presents restated financial statements for 2019 and 2020 adjusting for changes in the purchasing power of the local currency. - Items like cash, inventory, equipment, and liabilities were restated using currency conversion fractions to adjust for inflation. - A gain on purchasing power is recognized for 2020 to account for the decrease in purchasing power over that year.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 5

    Gabriel T.

    Soniel
    IA3
    COA 2E

    22-16
    2019 2020
    Historical Fraction Restated Historical
    Cash 3,000,000 200/120 5,000,000 4,250,000
    Inventory 2,200,000 200/110 4,000,000 3,000,000
    Equipment (net) 1,500,000 200/100 3,000,000 1,400,000
    Land 11,200,000 21,000,000 13,150,000

    Current Liability 1,500,000 200/120 2,500,000 2,000,000


    Non current liability 6,000,000 200/120 10,000,000 6,500,000
    Share Capital 3,000,000 200/100 6,000,000 3,000,000
    Retained earnings 700,000 2,500,000 1,650,000
    11,200,000 21,000,000 13,150,000

    Historical Fraction Restated


    Sales 8,000,000 200/160 10,000,000
    COGS:
    Inv. Jan 1 2,200,000 4,000,000
    Purchases 5,200,000 6,500,000
    Goods available for sale 7,400,000 10,500,000
    Inv. Dec 31 3,000,000 3,750,000
    Cost of Sales 4,400,000 6,750,000
    Gross Income 3,600,000 3,250,000
    Gain on purchasing power - 2,850,000
    Total Income 3,600,000 6,100,000
    Expenses:
    Distribution and Administrative 1,700,000 200/160 2,125,000
    Depreciation 100,000 200/100 200,000
    Total 1,800,000 2,375,000
    Income before tax 1,800,000 3,775,000
    Income tax 500,000 200/160 625,000
    Net income 1,300,000 3,150,000
    Add: Retained earnings Jan 1 700,000 2,500,000
    Total 2,000,000 5,650,000
    Less: Dividend 350,000 200/200 350,000
    Retained Earnings Dec 31 1,650,000 5,300,000

    Net monetary liabilities 12/31/19:


    Cash 5,000,000
    Current liabilities - 2,500,000
    Non current liabilities - 10,000,000
    Net monetary liabilities 12/31/19 - 7,500,000
    Increase in monetary assets, 2020:
    Sales 10,000,000
    Total 2,500,000
    Decrease in monetary assets, 2020
    Purchases 6,500,000
    Selling and administrative 2,125,000
    Income Tax 625,000
    Dividend 350,000 9,600,000
    Net monetary Liabilities 12/31/20, Restated - 7,100,000
    Less: Net monetary Liabilities 12/31/20, Cost
    Cash 4,250,000
    Current liabilities - 2,000,000
    Non current liabilities - 6,500,000 -4250000
    Gain on purchasing power 2850000

    23-12

    Legaspi Company
    Income Statement
    Year Ended 12/31/20

    Sales 5,000,000
    COGS 3,500,000
    Gross Income 1,500,000
    Other Income:
    Realized holding gain 330,000
    Unrealized Holding gain 1,340,000 1,670,000
    Total Income 3,170,000
    Operating Expenses:
    Expenses 700,000
    Depreciation 130,000 830,000
    Income Before Tax 2,340,000
    Less: Income Tax 350,000
    Net Income 1,990,000

    Legaspi Company
    Statement of Financial Position
    12/31/20

    Assets
    Current Assets:
    Cash 500,000
    Accounts Receivable 600,000
    Inventory 1,000,000 2,100,000
    Noncurrent Assets:
    Land 1,500,000
    Equipment 1,600,000
    Less: Accumulated Depreciaton 160,000 1,440,000 2,940,000
    Total Assets 5,040,000

    Liabilities and Shareholder's Equity


    Current Liabilities
    Accounts Payable 500,000
    Notes Payable 400,000
    Income Tax Payable 350,000 1,250,000
    Shareholder's Equity
    Share Capital 2,000,000
    Retained Earnings:
    Net income 1,990,000
    Dividends - 200,000 1,790,000 3,790,000
    Total liabilities and shareholder's equity 5,040,000

    Solution
    Cost of Goods Sols
    Ave. Current cost 3,500,000
    Historical cost 3,200,000
    Realized holding gain 300,000

    Inventory Dec 31
    Ave. Current cost 1,000,000
    Historical cost 900,000
    Unrealized holding gain 100,000

    Land
    Ave. Current cost 1,500,000
    Historical cost 800,000
    Unrealized holding gain 700,000

    Depreciation on average current cost 130,000


    Depreciation on historical cost 100,000
    Realized holding gain 30,000

    Net Current Cost:


    Current cost 1,600,000
    Accumulated Depreciation - 160,000 1,440,000
    Carrying Amount:
    Historical Cost 1,000,000
    Accumulated Depreciation - 100,000 900,000
    Unrealized Holding Gain 540,000
    2020
    Fraction Restated
    4,250,000
    200/160 3,750,000
    200/100 2,800,000
    19,800,000

    2,000,000
    3,500,000
    200/100 3,000,000
    5,300,000
    19,800,000

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