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What is the net income of the agency

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Reference no: EM132934427

Alabang Head Office opened a sales agency in Nuvali on January 1, 2023, The following is a summary of the transactions of the sales agency:

  1. Volume discount 1.5% and2.5%
  2. Invoice price P1,926,000
  3. Freight on shipment of agency 31,500
  4. Collections,20% of which were able to avail of the 5% discount 1,261,125
  5. Selling expenses paid from the agency fund 67,500
  6. Administrative expenses allocated to agency 4% of net sales
  7. Samples shipped to the agency amounting to P99,000 are to be properly depreciated to its carrying amount of P85,851 as of December 31, 2023.
  8. Remaining receivables are estimated to be 95% collectible.

Problem 1: The company's gross profit rate based on invoice price is 30% excluding the freight cost on shipments to agency.What is the net income of the agency for 2023?

Reference no: EM132934427

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