On April 10, 2020, B Trading sold merchandise to EFC Co. Limited for P130,000 under the terms: less: 5%; 2/10, n/30 FOB destination freight collect. EFC Co. Limited paid the freight of P5,000. On April 15, EFC Co. Limited returned to B Trading defective merchandise worth P10,000 (stated at list). EFC Co. Limited paid the account within the discount period amounting to P106,230. B Trading notify. EFC Co. Limited that the amount that they should pay is P106,720. Whose claim do you think is correct B or EFC? Explain
Question 1 and 2
1. On April 10, 2020, B Trading sold merchandise to EFC Co. Limited for P130,000 under the terms: less: 5%; 2/10, n/30 FOB destination freight collect. EFC Co. Limited paid the freight of P5,000. On April 15, EFC Co. Limited returned to B Trading defective merchandise worth P10,000 (stated at list). EFC Co. Limited paid the account within the discount period amounting to P106,230. B Trading notify. EFC Co. Limited that the amount that they should pay is P106,720. Whose claim do you think is correct B or EFC? Explain
2. On April 18, 2020, C Company purchased merchandise from Z Company amounting to P80,000 under the terms; 2/15, n/45 FOB Shipping Point freight Prepaid. Z Company paid freight amounting to P3,000. On April 20, 2020, C Company returned defective goods to Z Company amounting to P6,000. C Company paid the account within the discount period to avail of a discount. The accountant of C Company when he computed the cost of merchandise purchased told the manager that the total cost was P 72,520. On the other side, the accountant of Z Company reported a net sales of P69,520. In this situation, there might be one or the 2 companies are wrong. Who do you think is not reporting the correct value C or Z? Explain.
Using the data in no. 4, in case both of them are wrong, what is the correct cost of merchandise purchased for C Company and the correct net sales for Z Company?. Present your answer with an explanation why such answer is correct.
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