Reference no: EM132657700
The partial trial balance of ANATHEMA Company is presented below for December 31, 2016
Accounts Receivable P 34,000
Installment Accounts Receivable, 2016 192,000
Installment Accounts Receivable, 2015 90,000
Installment Accounts Receivable, 2014 22,000
Merchandise Inventory 48,000
Purchases 238,000
Freight-in 12,000
Repossessed Merchandise 14,000
Selling Expenses 92,000
Loss on Repossession, 2016 16,000
Loss on Repossession, 2014 8,000
Doubtful Accounts - Charge Sales 1,000
Cash Sales 60,000
Charge Sales 120,000
Installment Sales 300,000
Unrealized Gross Profit, 2015 56,000
Unrealized Gross Profit, 2014 32,000
Additional information:
- Merchandise inventory on December 31, 2016 (including new and repossessed merchandise) was P 52,000
- Charge sales prices and installment sales prices were higher than cash sales prices by 20% and 25%, respectively.
- Installment sales in 2014 and 2015 had gross profit rates of 40% and 35%, respectively.
- The following is the summary of the repossession account on December 31, 2016
Year of Sale FMV of Merchandise Loss Installment Contracts Receivable
2014 P 2,000 P 8,000 P 10,000
2015 12,000 16,000 28,000
P 14,000 P 24,000 P 38,000
The unrealized gross profit balances shown above were the amounts as of January 1, 2016 and were not adjusted during the year
REQUIRED:
Question 1. What is the total sales for 2016, if all sales were on cash basis?
Question 2. What is the cost of goods sold on installment sales for 2016?
Question 3. What is the gross profit rate in 2016?
Question 4. What is the total collection in 2016 from 2014 and 2015?
Question 5. What is the total realized gross profit on installment sales before gains or losses on repossession in 2016?
Question 6. How much is the adjusted loss on repossession in 2016 from 2014 and 2016 repossession?
Question 7. What is the net income (loss) for the year 2016?