Having been engaged as external auditor of Duhat Company on February 28, 2019, you were unable to observe the taking of inventory on December 31, 2019, which was reported to amount to P360,000. The following data, however, were gathered by you: Inventory, December 31, 2018 - P320.00 Purchases during 2019 - P1,410,000 Cash sales during 2019 - P350.00 Shipment received on December 26, 2019, included physical inventory but, not recordeds as purchases - P10,000 Deposits made with suppliers, entered as purchases, goods were not received in 2019 - P20,000 Collections on accounts receivable, 2019 - P1,800,000 Accounts Receivable, January 1, 2019 - P250,000 Accounts Receivable, December 31, 2019 - P300,000 Gross Profit percentage on sales - 40% Determine how much is the estimated inventory shortage at December 31, 2019.
Having been engaged as external auditor of Duhat Company on February 28, 2019, you were unable to observe the taking of inventory on December 31, 2019, which was reported to amount to P360,000. The following data, however, were gathered by you: Inventory, December 31, 2018 - P320.00 Purchases during 2019 - P1,410,000 Cash sales during 2019 - P350.00 Shipment received on December 26, 2019, included physical inventory but, not recordeds as purchases - P10,000 Deposits made with suppliers, entered as purchases, goods were not received in 2019 - P20,000 Collections on accounts receivable, 2019 - P1,800,000 Accounts Receivable, January 1, 2019 - P250,000 Accounts Receivable, December 31, 2019 - P300,000 Gross Profit percentage on sales - 40% Determine how much is the estimated inventory shortage at December 31, 2019.
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter6: Cost Of Goods Sold And Inventory
Section: Chapter Questions
Problem 39BE
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Having been engaged as external auditor of Duhat Company on February 28, 2019, you were unable to observe the taking of inventory on December 31, 2019, which was reported to amount to P360,000. The following data, however, were gathered by you:
Inventory, December 31, 2018 - P320.00
Purchases during 2019 - P1,410,000
Cash sales during 2019 - P350.00
Shipment received on December 26, 2019, included physical inventory but, not recordeds as purchases - P10,000
Deposits made with suppliers, entered as purchases, goods were not received in 2019 - P20,000
Collections on accounts receivable, 2019 - P1,800,000
Accounts Receivable, January 1, 2019 - P250,000
Accounts Receivable, December 31, 2019 - P300,000
Gross Profit percentage on sales - 40%
Determine how much is the estimated inventory shortage at December 31, 2019.
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