Reference no: EM132910588
Questions -
Q1. ESLAppliance has several branches in Visayas. It authorized transfer of cash and inventories among branches. The Home Office ships goods, P100,000 cost, to Cebu branch paying freight charges of P6,000. Later, Cebu Branch transfer the Goods amounting to P100,000 to Iloilo Branch and charged freight charges of P2,000. If the shipment had been made by the Head Office to Iloilo Branch, freight charges would have been P9,000. The transfer resulted to a difference in freight charges which should be disposed as follows:
a. P1,000 charge to Iloilo Branch by Cebu Branch
b. P1,000 charge to Iloilo Branch by Head Office
c. P1,000 to be equally charge among HO, Cebu Branch and Iloilo Branch
d. P1,000 savings
Q2. Hoya Corp. established its first branch on June 1, 2019. During the first month of operation, the HO shipped merchandise to the branch worth P138,000 which included a markup of 15% on cost. Sales for cash were P80,000 while sales on account were P250,000. At the end of the month, branch reported operating expenses P 38,000 and a closing inventory of P23,000 at billed price. As far as the home office is concerned, the true net income for June is:
a. P 177,000 c. P 82,000
b. P 192,000 d. P 147,000
Q3. On July 31, 2019, a fire destroyed the stockroom of Branganza Company. The following are the information of the company:
Merhandise Inventory Dec 31 2018 P110,000
For the Period Jan to July 2019
Purchases 560,000
Freight In 5,600
Purchase Return 10,200
Sales 695,000
Sales Returns and Allowances 7,500
Using the P 20% Gross Profit Rate, the cost of merchandise lost in fire was:
a. P 115,900 c. P 88,000
b. P 90,700 d. P 147,000
Q4. Hoya Corp. with a branch in Cebu City shipped merchandise to branch billed at P 150,000 including a markup of 20% on cost. Branch reports opening and closing inventories of P90,000 and P120,000, respectively. The HO has a closing inventory of P210,000 which includes merchandise which are held on consignment valued at P10,000. HO and Branch Office use the periodic system. What closing inventory would be reported in the combined statement of income for the year 2016.
a. P 330,000 c. P 300,000
b. P 296,000 d. P 320,000
Q5. Hoya Corp. started operation on April 1, 2016. On same date made shipment to branch costing P250,000. Additional shipment was made amounting to P125,000. The branch returned damaged merchandise worth P10,000. Inter office shipment is billed at 125% of cost. At the end of the month, the branch reported a net loss of P52,500 and inventory at P150,000. What is the branch net income (loss) reflected in the combined income statement for April?
a. P 43,000 c. (P52,500)
b. P 95,000 d. (P 9,500)