What amount should cherry report as total current liability

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Reference no: EM132806626

Problem 1: Cherry Corporation's current liabilities at December 31, 2020 totaled P1,800,000 before any necessary year-end adjustment relating to the following transactions: On December 23, 2020, a vendor authorized Cherry to return for full credit, merchandise shipped and billed at P54,000 on December 9, 2020. A P54,000 credit memo was received and recorded by Cherry on January 2, 2021. During December 2020, Cherry received P90,000 from Red, a customer, as an advance payment for a handicraft that Cherry will make to Red's specifications. From this transaction, Cherry has a P90,000 credit balance in its accounts receivable from Orange at December 31, 2020. What amount should Cherry report as total current liabilities in its December 31, 2020 balance sheet?

a. 1,746,000
b. 1,836,000
c. 1,890,000
d. 1,764,000

Reference no: EM132806626

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