FUNDAMENTALS OF

SENIOR
ACCOUNTANCY, BUSINESS HIGH
AND MANAGEMENT 2 (FABM 2) SCHOOL
2
Self-
Statement of Financial Position – Learning
Module
Report Form 2

Quarter 1
Fundamentals of Accountancy, Business and Management 2 (FABM2) – Grade 12
Quarter 1 – Self-Learning Module 2: Statement of Financial Position – Report Form
First Edition, 2020

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Published by the Department of Education Division of Pasig City

Development Team of the Self-Learning Module

Writer: Jennifer M. Hobrero

Editors: Dennis T. Alex / Edna D. Camarao
Reviewers: Content / Language: Hedelita B. Calonia / Buena R. Abestilla
Technical: Cerina V. Galoy (Technical)
Illustrator:
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FABM2 SENIOR
HIGH
SCHOOL

Self-
Learning
Module 2

Quarter 1

Statement of Financial Position –

Report Form
Introductory Message

For the facilitator:

Welcome to the Fundamentals of Accountancy, Business and Management 2 for

Grade 12 Self-Learning Module on Statement of Financial Position – Report Form!

This Self-Learning Module was collaboratively designed, developed and

reviewed by educators from the Schools Division Office of Pasig City headed by its
Officer-in-Charge Schools Division Superintendent, Ma. Evalou Concepcion A.
Agustin, in partnership with the City Government of Pasig through its mayor,
Honorable Victor Ma. Regis N. Sotto. The writers utilized the standards set by the K
to 12 Curriculum using the Most Essential Learning Competencies (MELC) in
developing this instructional resource.

This learning material hopes to engage the learners in guided and independent
learning activities at their own pace and time. Further, this also aims to help learners
acquire the needed 21st century skills especially the 5 Cs, namely: Communication,
Collaboration, Creativity, Critical Thinking, and Character while taking into
consideration their needs and circumstances.

In addition to the material in the main text, you will also see this box in the
body of the module:

Notes to the Teacher

This contains helpful tips or strategies that
will help you in guiding the learners.

As a facilitator you are expected to orient the learners on how to use this
module. You also need to keep track of the learners' progress while allowing them to
manage their own learning. Moreover, you are expected to encourage and assist the
learners as they do the tasks included in the module.
 For the learner:

Welcome to the Fundamentals of Accountancy, Business and Management 2

Self-Learning Module on Statement of Financial Position – Report Form !

This module was designed to provide you with fun and meaningful
opportunities for guided and independent learning at your own pace and time. You
will be enabled to process the contents of the learning material while being an active
learner.

This module has the following parts and corresponding icons:

Expectations - This points to the set of knowledge and skills

that you will learn after completing the module.

Pretest - This measures your prior knowledge about the lesson

at hand.

Recap - This part of the module provides a review of concepts

and skills that you already know about a previous lesson.

Lesson - This section discusses the topic in the module.

Activities - This is a set of activities that you need to perform.

Wrap-Up - This section summarizes the concepts and

application of the lesson.

Valuing - This part integrates a desirable moral value in the

lesson.

Posttest - This measures how much you have learned from the
entire module.
 EXPECTATIONS

After going through this self-learning module, you are expected to:
1. identify the key parts of Statement of Financial Position;
2. prepare an SFP using the report form with proper classification of items
as current and non-current; and
3. reflect on the importance of preparing SFP.

PRETEST

True or False: Directions: Write “/” if the statement is true and “X” if the
statement is false.
1. In a Statement of Financial Position written in report form, assets are
written on the left side while the liabilities and owner’s equity are
written on the right side.

2. The Statement of Financial Position and the Balance Sheet are different
financial statements.

3. Statement of Financial Position has a heading section which includes

the name of the company, name of the statement, and the date covered.

4. It is a must that the asset section of Statement of Financial Position has

the expenses section.

5. The current and non-current liabilities are arranged by liquidity.

 RECAP

Directions: Find the hidden horizontal, vertical, or diagonal words.

Give a brief definition of each word.

LESSON

Figure 2.1 ABC Company Statement of Financial Position

 1. What have you seen in the figure?
2. Can you tell me how much are the total assets? Total liabilities? Total
liabilities and equity?
3. At a glance, can you determine if assets are equal with liabilities and
equity? Why?
Statement of Financial Position- Report form
The Statement of Financial Position in report form is presented in a
vertical orientation and is essentially one column that spans the entire width
of a page. Starting with assets, the report form balance sheet provides a total
value at the end of the assets section, followed by liabilities and equity, with
the final line of the report form balance sheet providing the total combined
value of liabilities and equity (Palmer 2019, 1).
The following are the key parts of the Report Form of Statement of
Financial Position
1. Prepare the Statement Heading

ABC Company
Statement of Financial Position
As of December 31, 2019
Figure 2.2 Heading
The statement heading includes the name of the company, the name of
the statement, and the date covered. The date of the Statement of Financial
Position use of “as of” because the amounts in the SFP are permanent,
meaning that the amounts are cumulative from the beginning of the life of the
company.

2. Prepare the Asset Section

Figure 2.3 Asset Section

 Assets are categorized as current and non-current. The current and
non-current assets are arranged by liquidity (the ease of converting such
assets into cash)

3. Prepare the Liabilities Section

Figure 2.4 Liabilities Section

The liabilities are categorized as current and non-current. The current

and non-current liabilities are arranged by liquidity (the ease of converting
such liabilities into cash).

4. Prepare the Owner’s Equity Section

Figure 2.5 Owner’s Equity Section

This section is sourced from the ending balances of accounts in the

Statement of Changes in Equity.

5. Ensure that the Assets equate to Liabilities and Equity.

The accounting equation should be balanced. Finally, the statement is

footed and tested for accuracy.
 Rules on single/sole rule and double rule: when there is an operation
(addition, subtraction), single/sole rule. Total assets are double-ruled and
total liabilities and equity are double-ruled because they represent the end of
a part of the financial statement.

Figure 2.6 Completed Statement of Financial Position

When the company has a lot of assets (for example: cash, accounts
receivable, prepaid expenses), owners may sometimes think that the company
is doing well. There are instances that owners forget that they might also have
a lot of liabilities it may result in their equities having a very small balance.
With the preparation of the SFP, the owner can easily see the assets,
liabilities, and equity balances of his/her company which will show exactly
the financial position of the company as of a given point in time. Without the
SFP, the company cannot know if it truly owns anything because in the case
of bankruptcy, liabilities are paid first.
 ACTIVITIES

I. Practice

Directions: Solve the following problems.

1. ABC Retail Store had current assets amounting to Php 10,000. Non-
current assets for the year totaled Php 7,600. How much are the
company’s total assets?

2. ABC Retail Store’s total liabilities amounted to Php 1,000. Total equity
had an ending balance of Php 20,000. How much are total assets?

3. ABC Retail Store had the following accounts at yea-end: Cash-25,000,

Accounts Payable-70,00, Prepaid Expense-1,500. Compute for the
company’s current assets.

4. ABC Retail Store Accounts Receivable amounted to Php 50,000. Prepaid

Expense and Unearned Income totaled Php 3,000 and Php 1,000
respectively. Cash balance amounted to Php 10,000 while Accounts
Payable and Inventory totaled to Php 2,000 and Php 1,000 respectively.
How much are the company’s current assets? Current liabilities?

II. Keep Practicing

Directions. Prepare a Statement of Financial Position in Report form
using the following accounts:
Cash – 50,000
Loans Payable – 775,000
Accounts Receivable – 26,000
Supplies – 23000
Equipment – 170,000
Owner’s equity – 400,000
Accounts Payable – 224,000
Building – 1,130,000

Use any business name and the end of the previous year for the
heading.
III. Directions: Below is the Post-Closing Trial Balance of EC Company
for the year ended December 31, 2019. Prepare a Statement of
Financial Position in Report Form. Answer the following questions:
1. How much are the total current assets of EC Company? Total
non-current assets? Total assets?
2. How much are the total current liabilities of EC Company? Total
non-current liabilities? Total liabilities?
3. How much are the total liabilities and owner equity of EC?

EC COMPANY
Post Closing Trial Balance
December 31, 2019

Account Name Debit Credit

Cash 193300
Accounts receivable 125000
Prepaid rent 30000
Prepaid insurance 12000
Office supplies 2300
Store supplies 135000
Equipment 160000
Accounts Payable 20000
Notes Payable 90000
EC Capital 547600
657600 657600

WRAP-UP

Let’s wrap-up!

Directions: Answer the following questions:

➢ What are the key parts of the statement of financial

position? Can you give short description of each part?

➢ How are you going to describe the statement of financial

position in report form?

➢ What are your main takeaways in this lesson?

 VALUING

1. What are needed to keep in mind in preparing the report form of the
statement of financial position? Give at least three key points.

2. In your own point of view, what are the importance of preparing

statement of financial position?

POSTTEST

Directions: Use the accounts in the given table to prepare a pro forma
SFP using the report form.

Intangible assets Long-term payable Owner, capital

Unearned income Prepaid expenses Accounts receivable
Accounts payable Inventory Notes payable
Cash Property, plant, Mortgage payable
equipment
PRETEST
1. X
2. X
3. /
4. X
5. /
ACTIVITY
1. PHP 17,600
2. PHP 3,000
3. PHP 26,500
4. PHP 64,000 AND PHP 3,000
KEY TO CORRECTION
 REFERENCES
Beticon, J. L., Domingo, JC. D., Yabut, FA. D. 2016. Fundamentals of
Accountancy, Business, and Management 2, Teacher’s Manual.
Quezon City: Vibal Group Inc.
Beticon, J. L., Domingo, JC. D., Yabut, FA. D. 2016. Fundamentals of
Accountancy, Business, and Management 2. Quezon City: Vibal
Group Inc.
Binuya, MVJ. M. 2016. Fundamentals of Accountancy, Business, and
Management Book 2. Manila: JFS Publishing Services.
Dumrique, D. O., Cariño, C.I., Ignacio, R. M. 2014. Accounting MADE EASY.
Rizal: Jenher Publishing House
Monfero, RP. P., Andres, C. S., Salazar, DR. C., Honorario, C. B. Teaching
Guide for Senior High School, Fundamentals of Accountancy, Business,
and Management Book 2. Quezon City: Commission on Higher
Education.
Manuel, Z. V. 2016. 21st Century Accounting Process, International Edition.
Manila: Raintree Traiding and Publishing, Inc.
Salazar, D. R. 2017. Fundamentals of Accountancy, Business, and
Management 2. Manila: Rex Bookstore Inc.

Online References
https://www.bookwidgets.com/a/widgets/6308816135127040

https://smallbusiness.chron.com/difference-between-report-form-account-form-balance-sheets-
54993.html#:~:text=Statements%20of%20financial%20position%20forms%20provide%20a%
20snapshot%20of%20the,cash%20flows%20of%20a%20business.&text=Each%20of%20the%
20documents%20relies,Income%20statement.