JENNIFER KAMALI LAPAZTORA
NOTES TO FINANCIAL STATEMENTS
For The Year Ended December 31, 2024
(Amounts in Philippine Peso)
Notes
1 Company Information
JENNIFER KAMALI LAPAZTORA started the business on (DATE ESTABLISHED) with trade
name (NAME OF STORE) and is primarily engaged in [Business Type].
2 Significant Accounting Policies
A summary of more significant policies and practices are set forth below to facilitate the
understanding of data presented in the financial statements.
Basis of Preparation
The financial statements have been prepared in accordance with the Philippine Financial Reporting
Standard for Small Entities issued by the Philippine Reporting Standards Council (PFRSC) and
was based on the International Accounting Standards (IFRS) for Small and Medium-sized Entities
issued by the International Accounting Standards Board (IASB).
The accompanying financial statements have been prepared on a going concern basis, which
contemplate the realization of assets and settlement of liabilities in the normal course of business.
Currency of Presentation
Unless otherwise stated, all amounts are expressed in Philippine Pesos (Php), the domestic
currency. All financial information presented in Philippine Peso has been rounded off to nearest
peso.
Cash and Cash Equivalents
Cash includes cash on hand and in banks. Cash equivalent includes highly liquid investments with
maturities of 3 months or less from date of acquisition and that are subject to an insignificant risk
of change in value.
Inventories
Inventories are stated at the lower of costs and net realizable value. Costs comprise direct materials,
and where applicable, direct labor costs and those overhead that have been incurred in bringing the
inventory to their present location and condition. Cost is calculated using the weighted average
method.
Net realizable value represents the estimated selling price less all the estimated costs of completion
and costs to be incurred in selling and distributing the goods. When the net realizable value is lower
than the costs, the company provides for an allowance for the decline in value of the inventory and
recognizes the write-down as an expense in the income statement.
The amount of any reversal of any write-down of inventories, arising from an increase in net
realizable value, is recognized as a reduction in the amount of inventories recognized as an expense
in the period in which the reversal occurs. When inventories are sold, the carrying amount of those
inventories is recognized as an expense in the period in which the related revenue is recognized.
Property, Plant and Equipment
Property, plant and Equipment are measured at cost. Cost comprises the amount of cash or cash
equivalent paid and the fair value of other consideration given to acquire the said asset at the time
of acquisition. The treatment after the recognition of the asset is cost less accumulated.
Depreciation is computed on the straight-line method, based on the estimated useful lives of the
assets as follow:
Store Equipment 7 years
Service Vehicle 5 years
Depreciation of these assets, on the same basis as other property assets, begins when the assets are
ready for their intended use. Gain or loss from the disposal or retirement of an asset is determined
as the difference between the sales proceeds and the carrying amount of the asset and is recognized
as either income or expense in the income statement.
Trade and other payables
Trade payables are liabilities to pay for goods or services that have been received or supplied and
have invoiced or formally agreed with the supplier. Trade payables are not interest bearing and are
stated at their nominal value. Accruals are liabilities to pay for goods or services that have been
received or supplied but have not been paid, invoiced or formally agreed with the supplier,
including amounts due to employees.
Other Current Liabilities
This consists of accrued expenses and other liabilities not classified as one-line item under current
liabilities.
Current tax Liability
Consist of percentage tax payable and other taxes due and payable.
Owner’s Equity
The owner’s equity is also known as the owner’s capital account. It includes all current and prior
period results as disclosed in the statement of income and other adjustment to equity such as
drawings, prior period adjustment and other correction of errors if any.
Events after the End of the Reporting Period
The Company identifies subsequent events as events that occurred after the balance sheet date but
before the date when the financial statements were authorized for issue. Any subsequent events that
provide additional information about the Company’s financial position at the balance sheet date are
reflected in the financial statements. Events that are not adjusting events are disclosed in the notes
to the financial statements when material.
Revenue Recognition
Revenue is recognized to the extent that is probable that the economic benefits will flow to the
Company and revenue can be reliably measured.
Taxation
Current tax assets and liabilities for the current and prior periods are measured at the amount
expected to be recovered from or paid to the tax authority. The tax rate and tax laws used to
compute the amount are those that have been enacted or substantively enacted as at the balance
sheet date.
Deferred income tax is measured using the liability method on temporary differences at the
financial reporting date between the tax bases of assets and liabilities and their carrying amounts
for their financial reporting purposes. The carrying amount of deferred income tax asset is reviewed
at each reporting date and reduced to its probable utilizable amount. Unrecognized deferred income
tax assets are reassessed at each balance sheet date and are recognized to the extent that it has
become probable that future tax profit will allow deferred tax asset to be recovered.
Deferred tax assets and liabilities are computed at the tax rates applicable in the period in which
the liability is to be settled or asset to be recognized. Deferred tax assets and liabilities are offset if
a legally enforceable right to set off current tax assets against current tax liabilities and when they
relate to the same taxable entity and same taxation authority.
3 Management Accounting Judgment and Estimates
Judgments
The preparation of the Entity’s financial statements in conformity with Financial Reporting
Framework (in reference to the Generally Accepted Accounting Principles of the Philippines)
requires management to make estimates and assumptions that affect the amounts reported in the
Entity’s financial statements and accompanying notes.
The estimates and assumptions used in the Entity’s financial statements are based upon
management’s evaluation of relevant facts as circumstances as of the date of the Entity’s financial
statements. Actual results could differ from such estimates, judgments and estimates are continually
evaluated and are based on historical experience and other factors, including expectations of future
events that are believed to be reasonable under the circumstances.
Estimates
In the application of the Entity’s accounting policies, management is required to make judgments,
estimates and assumptions about the carrying amounts of assets and liabilities that are not easily
apparent from another source. The estimates and associated assumption are based on historical
experience and other factors that are considered to be relevant. Actual results may differ from these
estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions
to accounting estimates are recognized in the period in which the estimate is revised if the revision
affects only the period or in period of revision and future periods if the revision affects both current
and future periods.
The following represents the summary of significant estimates and judgments and related impact
and associated risks in the Owner’s financial statements.
Estimating useful lives of properties and equipment
The useful life of an asset is estimated based on the period on which the asset is to be available for
use. The assets are assessed periodically and updated in the event that the previous estimate differs
from the current estimated due primarily from wear and tear, technical or commercial obsolescence
of the said asset.
In addition, the estimate also takes into consideration the collective assessment of the industry
practices, internal technical evaluation and experience from other similar assets. A reduction in the
estimated useful life of the property, plant and equipment would increase the recognized operating
expenses and decrease non-current asset.
Revenue and cost recognition
The Entity’s revenue recognition policies require the use of estimates and assumptions that may
affect the reported amounts of revenues and receivables. Differences between the amounts initially
recognized and actual settlements are taken up in the accounts upon reconciliation. However, there
is no assurance that such use of estimates may not result to material adjustments in future periods.
Costs and expenses are recognized in the statement of income upon utilization of the service or in
the date they are incurred. Finance cost, if any, are reported on an accrual basis.
4 Cash and Cash
2024 2023 2022
Cash and Cash Equivalents
22,097,253 15,338,049 12,032,320
5 Inventory
2024 2023 2022
Ending Inventories
42,707 110,850 15,886
6 Property, Plant and Equipment
2024 cost Beg. Additions Disposals End
Balance Balance
Store Equipment
148,750 148,750
Service Vehicle
500,000 500,000
Total - -
648,750 648,750
Accumulated Depreciation
Store Equipment -
130,156 130,156
Service Vehicle - - -
Total - -
130,156 130,156
Net Book Value
Store Equipment - -
18,594 18,594
Service Vehicle -
500,000 500,000
Total - - 518,594
518,594
2023 cost Beg. Additions Disposals End
Balance Balance
Store Equipment
148,750 148,750
Service Vehicle
500,000 500,000
Total - -
648,750 648,750
Accumulated Depreciation
Store Equipment
111,563 18,593.75 130,156
Service Vehicle - - -
Total -
111,563 18,594 130,156
Net Book Value
Store Equipment -
37,188 (18,594) 18,594
Service Vehicle -
500,000 500,000
Total - 518,594
537,188 (18,594)
2022 cost Beg. Additions Disposals End
Balance Balance
Store Equipment
148,750 148,750
Service Vehicle
500,000 500,000
Total - -
648,750 648,750
Accumulated Depreciation
Store Equipment
92,969 18,593.75 111,563
Service Vehicle - - -
Total -
92,969 18,594 111,563
Net Book Value
Store Equipment -
55,781 (18,594) 37,188
Service Vehicle -
500,000 500,000
Total - 537,188
555,781 (18,594)
7 Current Tax Payable
2024 2023 2022
Trade and Other Payables
69,660.88 72,193.35 108,115.98
Income tax payable
3,390,274 2,706,399.20 3,060,494.20
3,390,274 2,706,399.20 3,060,494.20
7.1 Income tax payable
Sales
21,362,265 18,662,265 20,012,265
Cost of Sales
(4,272,453) (3,732,453) (4,002,453)
Operating expenses
(5,686,400) (5,430,400) (5,558,400)
Net income
11,403,412 9,499,412 10,451,412
(8,000,000) (8,000,000) (8,000,000.00)
3,403,412 1,499,412 2,451,412
Tax Rate 35% 35% 35%
Total Income Tax Due
3,393,694.20 524,794 857,994
Basic Tax
- 2,202,500 2,202,500
previous negative 0 0 0
previously paid
3,420 20,895.00 0.00
Income tax still due
3,390,274 2,706,399 3,060,494
8 Revenue
2024 2023 2022
Revenue
21,362,265 18,662,265 20,012,265
9 Cost of Sales
2024 2023 2022
Beginning inventory -
110,850.00 15,885.70
Purchases 4,018,338.70
4,204,309.57 3,827,417.30
Available for sale 4,018,338.70
4,315,159.57 3,843,303.00
Less: Ending inventory 15,885.70
42,706.57 110,850.00
Cost of sales 4,002,453.00
4,272,453.00 3,732,453.00
10 Administrative Expenses
2024 2023 2022
Taxes and licenses
13,682.05 18,270.70 15,976.38
Depreciation
- 18,593.75 18,593.75
Transportation and travelling
2,285.70 2,285.70 2,285.70
Supplies
73,733.66 53,266.00 63,499.83
Electricity
1,200,000.00 1,200,000.00 1,200,000.00
Communication
- 2,750.00 3,397.00
Miscellaneous expenses
827,619.80 663,355.43 734,213.39
Rental fee
1,272,000.00 1,272,000.00 1,272,000.00
Salaries and wages
520,000.00 222,545.00 371,272.50
Stall Fee
63,042.50 47,098.00 55,070.25
Fuel & Oil
300,000.00 232,288.42 266,144.21
Professional Fee
89.29 - -
Total
4,272,453.00 3,732,453.00 4,002,453.00
11 Events after the End of the Reporting Period
No any significant events took place after the Reporting Period that could affect the presentation of the
financial statements.
