Assume during 20x2, P Corporation sold merchandise again to S Company for P25,000 at a gross margin of 20%. Of this merchandise, P6,000 remains in the ending inventories of S Company on December 31, 20x2 Parent Subsidiary Statement of Financial Position Cash 231,000 85,000 Accounts receivable, net 150,000 80,000 Inventory 180,000 90,000 PPE 475,000 300,000 Investment in subsidiary 300,000 Total Assets 1,336,000 555,000 Accounts payable 100,000 100,000 Bonds Payable 200,000 100,000 Share capital: P Company S Company 500,000 200,000 Retained Earnings 536,000 155,000 Total Liabilities and equity 1,336,000 555,000 Statement of Comprehensive Income Sales 450,000 300,000 Dividend Income 32,000 Total Revenue 482,000 300,000 Cost of Goods Sold 180,000 160,000

Assume during 20x2, P Corporation sold merchandise again to S Company for P25,000 at a gross margin of 20%. Of this merchandise, P6,000 remains in the ending inventories of S Company on December 31, 20x2 Parent Subsidiary Statement of Financial Position Cash 231,000 85,000 Accounts receivable, net 150,000 80,000 Inventory 180,000 90,000 PPE 475,000 300,000 Investment in subsidiary 300,000 Total Assets 1,336,000 555,000 Accounts payable 100,000 100,000 Bonds Payable 200,000 100,000 Share capital: P Company S Company 500,000 200,000 Retained Earnings 536,000 155,000 Total Liabilities and equity 1,336,000 555,000 Statement of Comprehensive Income Sales 450,000 300,000 Dividend Income 32,000 Total Revenue 482,000 300,000 Cost of Goods Sold 180,000 160,000

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter9: Metric-analysis Of Financial Statements

Section: Chapter Questions

Problem 9.12E: Inventory analysis Costco Wholesale Corporation (COST) and Wal-Mart Stores Inc. (WMT) compete...

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RE7-8 Johnson Company uses a perpetual inventory system. On October 23, Johnson purchased 100,000 of inventory on credit with payment terms of 1/15, net 45. Using the net price method, prepare journal entries to record Johnsons purchases on October 23 and the subsequent payment on October 31. Using the information from RE7-8, prepare journal entries to record Johnsons purchase on October 23 and the subsequent payment on November 30.
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