Multiple Choice Question

21. Contract price per units (P32 x 2,000) 64,000

Market price, Dec. 31, 2024 (P26 x 2,000) 52,000
Total loss 12,000

22. Invoice Price (90,000 x 80% x 90%) 64,800

Add: Freight charge 5,000
Total cost of inventory 69,800

23. Invoice Price (150k x 85% x 90% x 95%) 109,012.50

24. Invoice Price 109,012.50

Less: Cash discount (109,012.50 x 2%) 2,180.25
Cash paid. 106,832.25

25. Purchase of IBM compatibles 3,280,000

Less: Return and allowance 80,000
Net purchase 3,200,000
Less: Discount (97% x 3.2M) 3,104,000
Discount loss 96,000

26. Reported Inventory. 1,500,000

Goods in transit purchased FOB shipping points. 50,000
Correct inventory amount. 1,550,000

27. Inventory on hand 3,000,000

Invoice Price 490,000
Less: freight 40,000
Selling Price 450,000
Markup based on cost ÷ 150% _
Goods in transit not included in inventory 300,000
Invoice price 600,000
Add: freight cost 60,000 _
Goods purchased in transit, FOB sp 660,000
Selling Price 300,000
Markup based on cost ÷ 150%
Inventory cost 200,000
Add: freight 30,000 _
Goods out on consignment 230,000
Correct amount of inventory, Dec. 31 4,190,0000
28. Inventory 5,000,000
(Add/Less) :
Merchandise in delivery department 80,000
Imported goods, trust receipt was accepted 800,000
Goods in transit FOB destination 25,000
Correct amount of merchandise inventory 4,190,000

29. Inventory physical count 77,500

Goods purchased in transit FOB destination 6,000
Correct inventory amount 83,500

30. Direct Materials 550,000

Purchased materials FOB sp 90,000
Work in Process 380,000
Finished goods 450,000
Goods on consignment (150k x 80%) 120,000
Cost of inventory 1,590,000

31. Markup on merchandise on consignment

Selling Price 104,000
Cost (104k ÷ 130%) 80,000 24,000
Goods held on consignment 56,000
Goods out on approval (32,500 - 25,000) 7,500
Total reduction in inventory 87,500

32. Sales or issuance

(3,000 x 35) 105,000
(2,000 x 36) 72,000
(1,000 x 37) 37,000 _
Total Sales 214,000
Cost of Goods Sold
(4,000 x 25) 100,000
(3,000 x 26) 78,000
(3,500 x 28) 98,000
(500 x 27) 13,500
Less: total inventory cost 137,000 (152,000)
Gross Profit on Sales 62,000

33. 1,600 @ 8.00 = 12,800

4,800 @ 9.60 = 46,080
6,400 58,880

58,880/6,400 = P9.20
34. Lower Cost Net Realizable Value (LCNRV)
Cost NRV

22 27

55 52

LOWER = 22 & 52

35. LCNRV
LOWER UNITS TOTAL

H 25 1,000 25,000

O 36 2,000 72,000

P 120 3,000 360,000

E 18 4,000 72,000

Total Value of Inventory 529,000

36.
Cost Units Total

5 40,000 200,000

40 10,000 400,000

Total Inventory At Cost 600,000

LCNRV UNITS TOTAL

5 40,000 200,000

39.50 10,000 395,000

Total Inventory at LCNRV 595,000

Total Inventory at Cost 600,000

Total Inventory at LCNRV 595,000
Inventory Materials Written Off 5,000

37. Beginning inventory 600,000

Purchases (400k + 500k + 600k) 1,500,000
Cost of goods avail. for sale 2,100,000
 Less: Cost of goods sold (2,240,000 ÷ 140%) 1,600,000
Cost of Inventory before fire 500,000

38. Beginning Inventory 180,000

Purchases (2,250,000 + 250,000 - 300,000) 2,500,000
Cost of goods avail. for sale 2,680,000
Less: Cost of goods sold (3M ÷ 125%) 2,400,000
Estimated Cost of Ending Inventory 280,000
Less: physical count of inventory 110,000
Inventory Shortage 170,000

39. Beginning Inventory 520,000

Add: Purchases 2,180,000
Cost of goods avail. for sale 2,700,000
Less: Estimated COGS (2.5M x 70%) 1,750,000
Estimated Cost of Ending Inventory 950,000
Less: Merchandise out on consignment 105,000
Less: Goods in transit FOB sp 95,000
Inventory Fire Loss 750,000
40. Beginning Inventory 120,160 Net Sales (530,180 - 5,980) 524,200
Net Purchases (405,476 - 11,110) 394,366 Less: COGS 408,876
Cost of goods avail. For sale 514,526 Gross Profit 115,324
Less: Ending inventory 105,650
COGS 408,876 GPM Rate (115,324/524,200) 0.22

41. Direct Materials (400k + 1.280M - 740k) 940,000

Direct Labor 960,000
Manufacturing overhead (960k x 50%) 480,000
Total Manufacturing Cost 2,380,000
Work in Process, Beginning 1,100,000
Total Factory Overhead 3,480,000
Finished goods, beginning 1,500,000
Estimated COGS (4.0M x 75%) (3,000,000)
Cost of goods avail. For sale 1,980,000
Finished goods, end (1,310,000)
Cost of work in process lost 670,000

42. Cost Retail

Beginning Inventory 617,000 1,057,000
Purchases 1,281,000 2,158,000
Purchase returns (21,000) (35,000)
Freight In 31,000 _________
Goods avail. For sale 1,908,000 3,180,000
Net Sales (2,365,000 - 62,000) (2,303,000)
 Ending inventory, at retail 877,000
Less: physical count of inventory, retail 780,000
Inventory pilferage, retail 97,000
Cost to retail ratio (1.908M/3.180M) 60%
Cost of Inventory Pilferage 58,200

43. Cost Retail

Beginning Inventory 47,075 70,025
Purchases 213,327 306,375
Freight In 3,400
Additional: net Markup (18,900 - 7,800) 11,100
Less: Markdown 10,640
Goods avail. For sale 263,000 376,860

Sales 320,500
Cost to retail ratio (263k/376,860) 70%
Cost of goods sold 224,350

44. Goods avail. For sale 376,860

Less: Sales 320,500
Ending inventory, at retail 56,360
Less: physical count of inventory, retail 39,390
Inventory Shortage, retail 16,970
Cost to retail ratio (263k/376,860) 70%
Estimated Loss from Inventory Shortage 11,879

45. Cost Retail

Beginning Inventory 23,000 60,000
Purchases 120,000 220,000
Additional: net Markup 20,000
Less: net Markdown 40,000
Goods avail. For sale 143,000 260,000
Less: Sales revenue 180,000
Ending inventory, at retail 80,000
Cost to retail ratio (143k/260k) 55%
Estimated Cost of ending inventory 44,000

46. Reported Profit 600,000

(Add/Less)
Overstated Ending Inventory (10,000)
Understated Beginning Inventory (4,000)
Understated Purchase (100,000)
Adjusted Profit for the year 486,000