1.  Gucci is famous for fashion wristwatches and leather goods.  At the end of a recent year, Gucci's total assets added up to P38,100,000, and the owner's equity was P26,400,000.  How much did Gucci owe creditors?*a. P26,400,000b. P38,100,000c.P11,700,000d. cannot be determined from the given data

Assume that Gucci sold watches for P50,000 to a department store on account.  How would this transaction affect Gucci's accounting equation?*a. No effect on the accounting equationb. increase in both assets and liabilities by P50,000c. increase both assets and owner's equity by P50,000d. increase both liabilities and owner's equity by P50,000

4.  Assume Gucci paid expenses totaling P35,000. How does this transaction affect Gucci's accounting equation?*a. Decreases both assetsf and owner's equityb. Decreases assets and increases liabilitiesc. Increases both assets and owner's equityd. increases assets and decrease liabilities

5.  Consider all the effects of transactions on question numbers 2 and 4 on Gucci.  What is the net income or net loss?*a. Net loss of P35,000b. Net income of P50,000c. Net income of P15,000d. cannot be determined from the given data

At the beginning of 2023, CCC Corporation issued 20,000 ordinary shares of P20 par value and 40,000 cumulative preference shares of P20 par value for a total consideration of P1,600,000. At this date, the ordinary share was selling for P36, and the cumulative preference share was selling for P27.What amount should be credited to ordinary share capital account?

Argent Corporation had earnings per share of $4 last year, and it paid a $2 divi-dend. Total retained earnings increased by $12 million during the year, and bookvalue per share at year-end was $40. Argent has no preferred stock, and no newcommon stock was issued during the year. If Argent’s year-end debt (whichequals its total liabilities) was $120 million, what was the company’s year-enddebt/assets ratio?Chapter 3: Analysis of Financial Statements 111