Caroline Company provided the following information on December 31, 2021: Jan. 15, 2022 P3,000,000 of accounts...

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Caroline Company provided the following information on December 31, 2021: Jan. 15, 2022 P3,000,000 of accounts receivable was written off due to the bankruptcy of a major customer. Feb. 14, 2022 A shipping vessel of Caroline with carrying amount of P5,000,000 was completely lost at sea because of a hurricane. Mar.. 11, 2022 A court case involving Caroline as the defendant was settled and the entity was obligated to pay the plaintiff R1,500,000. Caroline previously recognized a P1,000,000 liability for the suit because management deemed it probable that the entity would lose the case. Mar. 25, 2022 One of Caroline's factories with a carrying amount of P15,000,000 was completely razed by forest fires that erupted in its vicinity. The management of the entity completed the draft of the financial statements for 2021 on February 10, 2022. On March 20, 2022, the board of directors authorized the financial statements for issue. The entity announced the profit and other selected information on March 22, 2022. The financial statements were made available to shareholders on April 2, 2022 at the annual shareholders' meeting where the financial statements were approved. The financial statements were filed with the regulatory agency the very next day.. Required: Additional required: Prepare Journal Entries 1. Prepare adjusting entries on December 31, 2021 to reflect the adjusting events after reporting period. 2. Prepare the necessary disclosures to reflect the nonadjusting events after reporting period. Caroline Company provided the following information on December 31, 2021: Jan. 15, 2022 P3,000,000 of accounts receivable was written off due to the bankruptcy of a major customer. Feb. 14, 2022 A shipping vessel of Caroline with carrying amount of P5,000,000 was completely lost at sea because of a hurricane. Mar.. 11, 2022 A court case involving Caroline as the defendant was settled and the entity was obligated to pay the plaintiff R1,500,000. Caroline previously recognized a P1,000,000 liability for the suit because management deemed it probable that the entity would lose the case. Mar. 25, 2022 One of Caroline's factories with a carrying amount of P15,000,000 was completely razed by forest fires that erupted in its vicinity. The management of the entity completed the draft of the financial statements for 2021 on February 10, 2022. On March 20, 2022, the board of directors authorized the financial statements for issue. The entity announced the profit and other selected information on March 22, 2022. The financial statements were made available to shareholders on April 2, 2022 at the annual shareholders' meeting where the financial statements were approved. The financial statements were filed with the regulatory agency the very next day.. Required: Additional required: Prepare Journal Entries 1. Prepare adjusting entries on December 31, 2021 to reflect the adjusting events after reporting period. 2. Prepare the necessary disclosures to reflect the nonadjusting events after reporting period.

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Adjusting Entries After the Reporting Period 3 Court Case Settlement Calculate the additional liabil... View the full answer