Reference no: EM133068344
Question - You were assigned to audit the inventories of Bartleby Graduate Corp. for the period ended December 31, 2020. The system of internal control of Bartleby Graduate Corp.'s inventories were strong, as such you decided the inventory count procedures may be rendered by the company at an interim period, October 31, 2020 rather than at year-end. The following resulted to your audit examination:
Inventory, January 1 P879,000
Inventory, October 31 per physical count 400,000
Purchases from January 1 to October 31 per records 5,740,000
Purchase discounts (Jan. 1 to Oct. 31, per records) 300,000
Purchase returns and allowances (Jan. 1 to Oct. 31, per records) 120,000
Sales from January 1, to October 31 per records 11,700,000
Sales discounts (Jan. 1 to Oct. 31 per records) 550,000
Sales returns and allowances (Jan. 1 to Oct. 31 per records) 225,000
Purchases from November 1 to December 31 per records 1,070,000
Purchase discounts (Nov. 1 to Dec. 31 per records) 80,000
Purchase returns and allowances (Nov. 1 to Dec. 31 per records) 60,000
Sales from November 1 to December 31 per records 2,110,000
Sales discounts (Nov. 1 to Dec. 51 per records) 120,000
Sales returns and allowances (Nov. 1 to Dec. 31 per records) 90,000
Audit notes:
a. Purchases in transit invoiced at P480,000 on October 31, 2020, FOB shipping point were recorded as purchases in October although goods were received only on November 3, 2020.
b. Purchases in transit invoiced at P150,000 on October 31, 2020, FOB destination were recorded as purchases in October although goods were received only on November 4, 2020.
c. Cash deposits to suppliers amounting to P120,000 on September 30 were recorded as purchases upon payment. Goods related to the cash deposits were received only on November 15.
d. Purchases in transit invoiced at P70,000 on December 31, 2020, FOB destination were recorded as purchases in December although goods were received only on January 4, 2021.
e. Cash deposits to suppliers amounting to P90,000 on December 1 were recorded as purchases upon payment. Goods related to the cash deposit however were received only on January 5, 2021.
f. Goods costing P180,000 were partially damaged while in transit from a supplier in October (FOB Shipping Point). The goods were sold in December at half of the company's normal gross profit based on sales.
Required - What is the correct net purchases from November 1 to December 31?