Reference no: EM132646648

Questions -

Q1. The Zamboanga branch of Casio Corporation submitted the following balance as of 30 June 2017:

	DEBIT	CREDIT
Cash	P28,600
Accounts Receivable	173,800
Shipments from home office	462,000
Home Office - Current		324,500
Sales		369,600
Expenses	29,700
TOTAL	P694,100	P694,100

Zamboanga reported an ending inventory of P138,600. Shipments are billed at a mark-up of 40% on cost. What is the real net income of Zamboanga branch?

Q2. Using the same data above. What is the reported net income of Zamboanga branch?

Q3. On December 31, 2017, the investment in Branch account on the home office's books has a balance of P102,000. In analyzing the activity in each of these accounts for December, you find the following differences:

a. A P12,000 branch remittance to the home office initiated on December 27, 2017, was recorded on the home office books on January 3, 2018.

b. A home office inventory shipment to the branch on December 28, 2017, was recorded by the branch on January 4, 2018; the billing of P24,000 was at cost.

c. The home office incurred P14,000 of advertising expenses and allocated P6,000 of this amount to the branch on December 15, 2017. The branch has not recorded this transaction.

d. A branch customer erroneously remitted P3,600 to the home office. The home office recorded this cash collection on December 23, 2017. Meanwhile, back at the branch, no entry has been made yet.

e. Inventory costing P51,600 was sent to the branch by the home office on December 10, 2017. The billing was at cost, but the branch recorded the transaction at P40,800.

Compute the balance as of December 31, 2017 of the Unadjusted Balance of the Home Office Account:

Q4. Using the same data above. Compute the balance as of December 31, 2017 of the Adjusted Balance of the Reciprocal Account:

Q5. The following were found in your examination of the interplant accounts between the Home Office and the Cebu Branch:

a. Transfer of fixed assets from Home Office amounting to P53,960 was not booked by the branch.

b. P10,000 covering marketing expense of another branch was charged by Home Office to Cebu Branch.

c. Cebu recorded a debit note on inventory transfers from Home Office of P75,000 twice.

d. Home Office recorded cash transfer of P65,700 from Cebu Branch as coming from Davao Branch.

e. Cebu reversed a previous debit memo from Cagayan de Oro Branch amounting to P10,500. Home office decided that this charge is appropriately Davao Branch's cost.

f. Cebu recorded a debit memo from Home Office of P4,650 as P4,560.

The net adjustment in the home office books related to Cebu branch current account is:

Q6. Using the same data above. The net adjustment in Cebu's books related to Home Office account is:

Q7. Using the same data above. Before the discrepancies were given effect, the balance in the home office books of its Cebu Branch Current account was debit balance of P165,920. The unadjusted balance in Cebu Branch books of its Home Office Current account must be:

Q8. Using the same data above. The adjusted balance of the reciprocal accounts is:

Q9. At the end of 2016, the branch reported an inventory of P15,625. The home office bills this branch at 130% of cost. During 2017, goods costing P300,000 were shipped to the branch. The account "allowance for overvaluation of branch inventory" after adjustment, shows a balance of P16,250 at the end of the year.

What was the amount of inventory at January 1, 2017 at cost?

Q10. Using the same data above. What was the amount of ending inventory at billed price?