ACCT207 Study Guide - Midterm Guide: Promissory Note
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Using the financial statements below,please calculate thefollowing
The current position of each company,
The market value of each company,
The amount of profit generated by each dollar ofassets or equity,
How much debt is involved in each company compared to equity,and
How solvent each business is.
THE PEOPLESâ CREDIT UNION LIMITED
Financial statements for THE PEOPLESâ CREDIT UNION LIMITD) forthe year ended December 31, 2017.
Each share costs $5.00
The dividend paid was 3.75%
December 31, 2017 | |
Cash Resources: | |
Cash in hand and at bank | 11,961,005 |
Short-term investments | 71,000,511 |
Total cash resources | 82,691,516 |
Other Assets: | |
Accounts receivable and prepayments | 2,738,666 |
Net loans to members | 343,075,646 |
Long-term investments | 71,513,400 |
Fixed assets | 29,202,515 |
Total Assets | 529,221,743 |
Liabilities: | |
Accounts payable and accruals | 7,800,932 |
Membersâ deposit savings | 34,623,468 |
Membersâ time deposits (fixed deposits) | 90,629,600 |
Provision for terminal benefits | 5,303,180 |
Retirement benefit obligations | 638,200 |
Membersâ share savings | 324,230,903 |
Total liabilities | 463,226,283 |
Institutional Capital: | |
Reserve fund | 22,992,421 |
Education fund | 1,446,107 |
Loan protection fund | 836,726 |
Building fund | 12,250,000 |
Investment re-measurement reserve | 15,266,397 |
Undivided earnings | 13,203,809 |
Total institutional capital | 65,995,460 |
Total Liabilities and Institutional Capital | 529,221,743 |
For the year ended December 31 2017 | |
Income: | |
Interest on loans | 37,358,266 |
Investment income (net) | 2,020,571 |
Other income | 1,262,899 |
Total Income | 40,671,736 |
Expenditure: | |
Administrative expenses | 7,956,429 |
Board and committeesâ expenses | 1,072,631 |
Life saving insurance | 866,002 |
Loan protection expense | 1,716,236 |
Loan loss expense | 129,286 |
Interest on membersâ expense | 2,170,128 |
Members education, training and development expenses | 1,636,889 |
Personnel costs | 10,635,898 |
Total expenditure | 26,183,499 |
Net surplus for the year | 14,458,237 |
Other comprehensive income | |
Items that may be re-classified later as profit or loss | |
Unrealised (loss)/gain on available-for-sale financialassets | 974,380 |
Items that may be re-classified later as profit or loss | |
Net actuarial (loss)/gain on retirement benefit obligations | (294,500) |
679,880 | |
Total Comprehensive Income for the year | 15,138,117 |
Reserve fund | Education fund | Loan protection fund | Building fund | Investment re-measurement fund | Undivided earnings | |
Balance as at January 1, 2017 | 21,523,987 | 1,170,891 | 711,676 | 11,500,000 | 14,292,017 | 11,819,316 |
Total comprehensive income for the year | 974,380 | 14,163,737 | ||||
Appropriation of net surplus for the year: | ||||||
10 % to the Reserve Fund | 1,416,374 | (1,416,374) | ||||
13.5% to the Education Fund | 1,912,105 | (1,912,105) | ||||
13% to the Loan Protection Fund | 1,841,286 | (1,841,286) | ||||
22,940,361 | 3,082,996 | 2,552,962 | 11,500,000 | 15,266,397 | 20,813,288 | |
Add/(less) adjustments as follows: | ||||||
Dividends (2016) | (10,160,544) | |||||
Entrance fees | 52,060 | (52,060) | ||||
Member education, training and development expenses | (1,636,889) | 1,636,889 | ||||
Transfer to Building Fund | 750,000 | (750,000) | ||||
Loan protection expense | (1,716,236) | 1,716,236 | ||||
Balance as at December 31, 2017 | 22,992,421 | 1,446,107 | 836,726 | 12,250,000 | 15,266,397 | 13,203,809 |