Problem 4. Masagana Corporation has a PI,500,000 credit balance of Accumulated Profits (Losses) in 20A. The following transactions are taken from the 20B operations: a) net loss, P250,000 b) purchase of treasury shares at cost, P120,000 c) overstatement of depreciation in 20A, P40,000. d) declaration of dividends, P450,000. e) reversal of appropriation reserve for plant expansion, P500,000. f) understatement of inventory in 20A; P75,000. Required: 1. Journalize the above transactions 2. Compute the adjusted accumulated profits (losses) at the end of the year

Problem 4. Masagana Corporation has a PI,500,000 credit balance of Accumulated Profits (Losses) in 20A. The following transactions are taken from the 20B operations: a) net loss, P250,000 b) purchase of treasury shares at cost, P120,000 c) overstatement of depreciation in 20A, P40,000. d) declaration of dividends, P450,000. e) reversal of appropriation reserve for plant expansion, P500,000. f) understatement of inventory in 20A; P75,000. Required: 1. Journalize the above transactions 2. Compute the adjusted accumulated profits (losses) at the end of the year

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter5: Corporations: Earnings & Profits And Dividend Distributions

Section: Chapter Questions

Problem 31P

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1. Refer to the following financial information of Scholz Company: NOPAT                    8,250,000.00 EBITDA                  17,725,000.00 Net Income                    5,050,000.00 Capital Expenditures                    6,820,000.00 After tax capital costs                    6,280,000.00 Tax rate 40% Calculate the Company’s depreciation and amortization expense 2. Refer to Scholz Company, calculate its interest expense. Use 2 decimal places for your final answer. 3. Refer to Scholz Company, calculate its EVA. Use 2 decimal places for your final answer.