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Cheese Company has thc following account balances: Sales revenue, P1,600,000; income
hom continuing
operation, P200,000; net.income, P180,000; income lrom operation, P440,000; selling and administrativc
expenses, I'1,000,000; income before incorrre tax, 11400,000. Wlrat is the amounl of finance
cost?
a) P20,000 c) P160,000
b) P40,000 d) P200,000

16. Ilazel Corporation has an income tax rate of 32Yo and inconre before rlon-ooerati s o1'P524,000. It also
has the following items (at gross amounts): unusual t,rri, t,z+,ooo; air"dffiffi"ration
lgss, 11202,000; gailr
ftun the disposal of equipment, P16,000 ard change in accounting principle increasing prior year's inoqmc,
Pl06'000. What is thc arnount of income tax cxpense llazel Corporation would r"p,i.i on iis statelnent oi'

a) P 84,480 c) P177,920
b) P149,120 d) PI83,040
17, T'he following information pertains to Wencly Company during 2016:

-Ianuaryl' 2016 inventory, P450,000; December 31, 2016 inventory, P480,000; Purchases during thc year.
P1,800,000; Purchase returns and allowances, P105,000; Purchase discounts, P25,000; lransponation in,
Pl0,000; Sales during the year, P3,850.00O; Saies discounts granted, P70,000; Sales rctur4s, Ir120;000; Selling
cxpenses, P990,000; Administrative expenses, P825,000; Rental revcnue, P65,000; Dividen<t received,
P150,000; Income tax expense, fj4QO.igd-BgQlucd-gfnings, r, zul(r, P200,Oo0.I]nrealizcd
January 1.2016,
5s, J4rrud.)/ rzr^r)\r\^t.t)Ilreallzoo gall
sain
equity invcstment at lhir value t6t$i6mpre net of tax, P20,000; Revaluation surplus, fit.h
taxPl0'000andDividendspaidofPl5o.@rcnccssh.aresaccountcdasaliabiliiv.rA.-.)hh(alt0
tax P10,000 and Dividends paid of Pl

ese.stion t : ,'rhc company prcpares *,, ,.offiIffi,iu-f.fgyl"t#,r$""#11:.f;f:*#raruqr .r.

ffihouldthecompanyreport?c)P206,800?\rJ.I,,,:Jl,J
b) Prt6,8oo ti' li.i{ ,t.l."A
ij li[i,ffi
is the amount of comprchensive income assuming rhe company is consiiered rr, *"ul*ffa
Wffirwhat i-f*
a) P176,800 c) PI96,800
b) P186.800 d) P206,800
18. Presented below are year-end balances of thc assets and liabilities pertaining to Glacier Mcrohandising;

2016 2015
Cash Prffi)o P120.000
Equity investrnent at lbir value to prrtlil or loss 260,000 230,000
Accounts receivable, net 360,000 400,000
lnvcntories 705,000 635,000
-130,000
128,000
182,000 r 36,000
Accounts payable
Other current liabi litics 141.000 125,000
Bonds payablc 200.000 200,000
Additional investment made by the owncr during 201 6 was P I 50,000 but a P260,000 personal liabiliry was paid
out of company's l-unds. What is the company's profit or loss for the year ended December 31,20162
a) P 30,000 c) p190,000
b) P 140,000 d) P290,000
19. Monarch company's account balances curing 2016 showed the following changes:
0 Current'assets p 3,000,000 increase
Non-current assets 2,500,000 dccrease
Current liabilities I,600,000 clccrease
)l iV cii,.i:,h, Non-cument liabilitics , 1.000,000 increasc

1,.t ,, ' l 'l'.''' 1, '

Share u^apital 1,200,000 increasc
t Share premium capital 800,000 increase
:t' ir,1',
" 'l'here wcre no changes in retained earnings for 2016 other than a P1,500,000 dividend payment and year-cnd
result of opcrations. Ilow much is Monarchs' net income for 2016?
a) P500,000 c) P700,000
b) P600,000 d) P800,000

I 20; C)n January l,2015,Zhang Inc. had cash and share capital of PI0,000,000. At that date, the company had n<r
other asset, liability, or equity balances. On January 5. 2015. it purchased for cash p6,000.0d0 of equity
securities that il classified as non-trading. It received cash dividends of P{100,000 during the year on tfuese
securities. In addition, it has an unrealized loss on thesc securities of P600,000. The tax rate isZllU. Compule
the amount of comprchensive income.
a) P160,000 c) P600,000
b) P200,000 d) P640,000 3401