Reference no: EM133159600
Question - January 2011
FOB Term Date Shipped Date Received Invoice Number Amount
Destination 12/26/2014 1/3/2015 3625 P30,000
Shipping Point 12/27/2014 12/30/2014 4327 13,500
Destination 12/27/2014 12/29/2014 9001 4,200
Shipping Point 12/28/2014 1/4/2015 9981 16,000
Destination 12/29/2014 12/31/2014 8934 6,200
Shipping Point 1/3/2015 1/10/2015 7895 21,100
The physical inventory list includes P85,000 of merchandise received on consignment from a supplier.
The company has other goods shipped out on consignment that were not included in the physical inventory. They were still unsold at yearend, P65,000. Your examination disclosed that these goods were recorded as sales upon shipment at a total sales price of P98,000.
Shipments of December 31, 2014 with total billed price of P25,000 were properly recorded on the books as sale. You computed the cost of these sales to be P17,600.
Required - Prepare the necessary audit adjustments as at December 31, 2014. The purchases account had already been transferred to cost sales, while the inventory per list of the client had already been set up.