SEC Form 17-A: Annual Report - the solid group inc website

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Other accrued expenses include accrued rentals, accrued outside services, accrued salaries and
other operating expenses. Other payables primarily consist of payroll-related liabilities and
due to government agencies for unpaid tax obligations.
The carrying amounts of trade and other payables recognized in the consolidated statements
of financial position are considered to be a reasonable approximation of their fair value
(see Note 30.1).
17. REFUNDABLE DEPOSITS
SMC and Kita have long-term refundable deposits from various tenants amounting to
P16.0 million and P15.6 million as at December 31, 2012 and 2011, respectively. The
refundable deposits are remeasured at amortized cost using the effective interest ranging
from 7.22% to 15.77% at the inception of the lease terms. The interest expense recognized
amounting to P1.4 million in 2012, P0.6 million in 2011 and P0.9 million in 2010 is presented
as part of Finance Costs in the consolidated statements of income (see Note 21.2). The
non-current refundable deposits is shown as a separate line item under non-current liabilities
in the consolidated statements of financial position.
18. COST OF SALES, SERVICES AND RENTALS
18.1 Cost of Sales
The details of this account are shown below.
Notes 2012 2011 2010
Merchandise and finished goods
at beginning of year 10 P 621,292,896 P 412,507,056 P 62,462,687
Net purchases of merchandise
during the year 20, 26.6
26.2 2,925,915,239 2,700,622,823 1,582,453,911
Cost of goods manufactured:
Raw materials at beginning
of year 10 362,856 10,757,863 20,252,525
Work- in-process at
beginning of year 10 - 2,256,191 1,665,047
Net purchases of raw
materials during the year - 3,811,972 6,759,772
Direct labor - 1,715,564 3,709,810
Manufacturing overhead 1,831,269 16,613,479
Raw materials at end of year 10 ( 362,856) ( 362,856) ( 10,757,863 )
Work-in-process at
end of year - - ( 2,256,191 )
- 20,010,003 35,986,579
Goods available for sale 3,547,208,135 3,133,139,882 1,680,903,177
Merchandise and finished goods
at end of year 10 ( 406,495,008) ( 621,292,896) ( 412,507,056 )
Net provision (reversal) on
inventory obsolescence 10 ( 48,583,419) 27,304,279 ( 11,239,861 )
20 P 3,092,129,708 P 2,539,151,265 P 1,257,156,260