Reference no: EM132860424
Questions -
Q1. Data provided by XYZ Co. for 2020 are as follows: Freight-in P30,000 Purchase returns P75,000 Selling expenses P150,000 Ending inventory P260,000. The cost of goods sold is equal to 400% of selling expenses. What is the cost of goods available for sale?
A. P600,000
B. P890,000
C. P815,000
D. P860,000
Q2. MM Co. has the following information pertaining to its merchandise inventory as of December 31, 2020: Inventory on Hand (including inventory on consignment of P20,000) P200,000 Inventory purchased with the right of return P100,000 Merchandise purchased in transit, FOB shipping point P160,000 Merchandise sold in transit, FOB destination P247,000 Merchandise not in warehouse, held by the consignee P183,000. What amount should MM Co. report as the value of its inventory in its 2020 balance sheet?
A. P749,000
B. P760,000
C. P770,000
D. P876,000
E. answer not given
Q3. Based on a physical inventory taken on December 31, 2020, ABC Co. determined its chocolate inventory on a FIFO basis at P2,600,000 with a replacement cost of P2,500,000. ABC Co. estimated that, after further processing costs of P1,200,000, the chocolate could be sold as finished candy bars for P4,000,000. The normal profit margin is 10% of sales. Under the lower of cost or net realizable value, what amount should ABC Co. report a chocolate inventory in its December 31, 2020 statement of financial position?
A. P2,800,000
B. P2,600,000
C. P2,500,000
D. P2,400,000
E. answer not given