Reference no: EM132982193

Questions -

Q1. The physical count of inventory on hand of Rainy Company on December 31, 2021 showed the balance of P3,884,000. The following goods were excluded from the inventory count:

a. Goods received on consignment amounting to P220,000.

b. Goods with a retail price of P180,000 was on consignment to a customer.

c. Goods shipped FOB destination to a customer with a retail price of P460,000. The goods were received by the customer on January 5, 2022.

d. Goods in transit purchased "ex-ship", P125,000.

If the gross profit rate is 30%, what amount should Rainy Company report as value of its inventory in its December 31, 2021 statement of financial position?

Q2. Sunshine Corporation imported goods (bags and shoes) at a cost of P1,240,000, including P180,000 non-refundable import duties and P130,000 refundable purchase taxes. The Company incurred P24,000 to transport the goods to the Company's store. It is estimated that P5,000 will be incurred in delivering the goods to its customer. What amount should be reported as Inventory of Sunshine Corporation?

Q3. Sunny Company's operating expenses is about 25% of net sales. The cost of goods sold of the Company is 60% of net sales. In 2021, cost of sales amounted to P1,950,000. What is the amount of operating profit of Sunny Company in 2021?