MNRSQUARED CONSTRUCTION AND TRADING
NOTES TO FINANCIAL STATEMENTS
As of and for the year ended
December 31, 2024 and 2023
(In the notes all amounts are in Philippine Peso unless otherwise stated)
1. General information
MNRSQUARED CONSTRUCTION AND TRADING is a sole proprietorship business
owned by Muriel R. Laxamana. It was registered with the Department of Trade and Industry and
with the Bureau of Internal Revenue as per taxpayer identification number 215-485-984.
The registered business address is at 145 Rizal St. Phase I, Maimpis, City of San Fernando,
Pampanga. It is engaged in and carry on the trade and business of general builders and
contractors.
2. Basis of preparation and accounting policies
These consolidated financial statements have been prepared in accordance with the Philippine
Financial Reporting Standard for Small and Medium-sized Entities issued by the Philippine
Accounting Standards Board. They are presented in the currency units Philippine Peso.
Revenue recognition
Revenue from sales of goods is recognized when the goods are delivered and accepted by the
buyer. Revenue is measured at the fair value of the consideration received or receivable, net of
discounts and sales-related taxes collected in behalf of the government.
The group recognizes revenue when: the amount of revenue can be reliably measured; it is
probable that future economic benefits will flow to the entity; and specific criteria have been met
for each of the group activities.
Expense Recognition
Expense are recognized in the statement of income when decrease in economic benefit related as
decrease in asset or increase in liability arisen can be measured reliably. Expense are recognized
in the statement of income.
Property, plant and equipment
Items of property, plant and equipment are measured at cost less accumulated depreciation and
any accumulated impairment losses.
Depreciation is charged so as to allocate the cost of assets less their residual values over their
estimated useful lives, using the units of production/ average usage rate. The following annual
rates are used for the depreciation of property, plant and equipment:
Office Equipment 10 years
Transportation Equipment 10 years
Construction Equipment 10 years
If there is an indication that there has been a significant change in depreciation rate, useful life or
residual value of an asset, the depreciation of that asset is revised prospectively to reflect the new
expectations.
Impairment of assets
At each reporting date, property, plant and equipment, intangible assets and investments in
associates are reviewed to determine whether there is any indication that those assets have
suffered an impairment loss. If there is an indication of possible impairment, the recoverable
amount of any affected asset (or group of related assets) is estimated and compared with its
carrying amount. If estimated recoverable amount is lower, the carrying amount is reduced to its
estimated recoverable amount and an impairment loss is recognized immediately in profit or loss.
Similarly, at each reporting date, inventories are assessed for impairment by comparing the
carrying amount of each item of inventory (or group of similar items) with its selling price less
costs to complete and sell. If an item of inventory (or group of similar items) is impaired, its
carrying amount is reduced to selling price less costs to complete and sell, and an impairment
loss is recognized immediately in profit or loss.
If an impairment loss subsequently reverses, the carrying amount of the asset (or group of related
assets) is increased to the revised estimate of its recoverable amount (selling price less costs to
complete and sell, in the case of inventories), but not in excess of the amount that would have
been determined had no impairment loss been recognized for the asset (group of related assets)
in prior years. A reversal of an impairment loss is recognized immediately in profit or loss.
Biological Assets
Biological assets comprise of poultry and livestock animals held for use in production. As the
fair value of these biological asset can be readily determined without undue cost or effort, the
assets are initially recognized and subsequently carried at fair value less cost to sell. Any
resultant gain or loss on re-measuring to fair value less cost to sell at each reporting date is
recognized in profit or loss.
At the time of harvesting, the agricultural produce is recognized at fair value less cost to sell and
are included in inventory at this amount. They are not subsequently re-measured.
Inventories
Inventories are stated at the lower of cost and selling price less costs to complete and sell. Cost is
calculated using the first-in, first-out (FIFO) method.
Trade and other receivables
Most sales are made on the basis of normal credit terms and the receivables do not bear interest.
Where credit is extended beyond normal credit terms, receivables are measured at amortized cost
using the effective interest method. At the end of each reporting period, the carrying amounts of
trade and other receivables are reviewed to determine whether there is any objective evidence
that the amounts are not recoverable. If so, an impairment loss is recognized immediately in
profit or loss.
Trade payables
Trade payables are obligations on the basis of normal credit terms and do not bear interest. Trade
payables denominated in a foreign currency are translated into Philippine Peso using the
exchange rate at the reporting date. Foreign exchange gains or losses are included in other
income or other expenses.
Income Tax
Income tax is computed based on the individual tax rate that includes progressive tax rates that
ranges from 20%-35% with a standard base amount per bracket.
The Company measures its current tax liabilities or assets using the tax rates and laws that have
been enacted or substantively enacted by the reporting date. The Company regards tax rates as
substantively enacted when future events required by the enactment process historically have not
affected the outcome and are unlikely to do so. The Company does not discount current tax
assets and liabilities.
Bank loans and overdrafts
Interest expense is recognized on the basis of the effective interest method and is included in
finance costs.
Events after the reporting date
Post year-end events that provide additional information about the Company’s position at the
reporting date (adjusting events) are reflected in the financial statements. Post-year events that
are not adjusting events are disclosed in the notes to financial statements when material.
3. Revenue
2024 2023
Sale of Services 0.00 0.00
Total 0.00 0.00
4. Cost of Services
2024 2023
Beginning Inventories - -
Add: Purchases - -
Total Materials Available for Sale and Use - -
Less Ending Inventories - -
Construction Materials 0.00 0.00
Depreciation (1,298,000.00) (1,298,700.00)
Cost of Services (1,298,000.00) (1,298,700.00)
*If the entity classifies its expenses by nature in its income statement, this would say
‘included in raw materials, consumables used, and Semi Expendable Expenses.
The following items have been recognized as expenses in determining profit before tax:
5. Operating Expenses
2024 2023
Salaries and Wages 97,000.00 97,000.00
Interest 96,250.00
Insurance 89,598.00 89,598.00
SSS, PHIC and HDMF 38,778.00 38,778.00
Tax and Licenses 18,582.00 18,781.00
Depreciation 11,000.00 11,000.00
Professional Fees 8,000.00 10,000.00
Miscellaneous Expenses 0.00 6,810.00
Total 262,958.00 402,328.00
6. Other Income
2024 2023
Interest Income 1,525.01 2,146.00
7. Cash and cash equivalents
2024 2023
Cash on Hand and Cash in Bank 4,235,438.01 4,485,870.00
Petty Cash Fund 20,000.00 20,000.00
Total 4,255,438.01 4,505,870.00
2024 2023
Creditable Witholding Tax 464,01.00 464,01.00
Prepaid Input Tax 3,297.00 3,297.00
Total 467,898.00 467,898.00
8. Other Current Assets
Cost Beginning Addition Ending
House and Lot 2,550,000.00 - 2,550,000.00
Office Equipment 110,000.00 - 110,000.00
Transportation Equipment 8,917,000.00 - 8,917,000.00
Construction Equipment 4,070,000.00 - 4,070,000.00
Total
9. Property, Plant and Equipment
The depreciation for the years 2023 and 2022 is as follows:
Cost of Services Operating Expenses
Cost 2024 2023 2024 2023
Office Equipment 11,000.00 11,000.00
Transportation Equipment 891,700.00 891,700.00
Construction Equipment 407,000.00 407,000.00
Total 1,298,700.00 1,298,700.00 11,000.00 11,000.00
8. Events after the end of the Reporting Period
There were no events that require adjustment or disclosure between the reporting date and the
date of issuance of the audited financial statements.
The financial statements for the years ended December 31, 2023 and 2022 were approved and
authorized for issue by the owner on March 27, 2025.
