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Indigo Co. has a BRANCH in Coco established on April 1, 2019. During the year 2019, the Indigo Co. shipped merchandise to the BRANCH at billed value of P100,000 which was 25% above cost. At the end of the year, the BRANCH reported sales of P160,000, operating expenses of P76,000, and a net income from operations of P12,000.
Problem 1: The true income of the BRANCH was
a. P 14,400
b. P 26,400
c. P 12,000
d. P 20,000
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