Reference no: EM132649620

The following data were provided by the accountants of the home office and branch for the year ended December 31, 2015:

                                                        Home office books                       Branch Book

Net sales to outside customer           1,000,000                              800, 000

FIM Beginning inventory                      300,000                           140, 000

Net purchases from outsider                 800 , 000                             250,000

Shipment to branch                             400, 000

Shipment from Home office                       500,000

Ending inventory                                100,000                            200,000

Operating expenses                               200,000                               100,000

Additional notes: The current income tax rate is 301 It is the policy of the company to use the specific identification for its inventory For the year ended December 31, 2015, the home office bills its branch with a gross profit rate of 401 based on cost Half of the beginning inventory of the branch was acquired from outsider The ending inventory of the branch is broken down as follows:

• 60% from outside supplier 260 from 2015 shipment from home office
•  14% from 2014 shipment from home office

Question 1: What is the combined net income to be presented by the home office in 20157 its statement of comprehensive income for the year ended December 31, a. 217,000 b. 218, 120 c. 219,800