Operation account on May 30, 2021 would show a balance of: a. 45,750 b. 56,250 c. 54,250 d. 50,000
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On May 1, 2021, AAA and BBB formed a joint operation to acquire and sell a special type of merchandise. The contractual arrangements provide that AAA is to manage the joint operation for a fee and that gain and losses are to be divided equally. On May 1, 2021, BBB invests cash of P52,000, which P50,000 was used to purchase merchandise. AAA incurs expenses amounting to P2,500. On May 20, one half of the merchandise was sold for P36,000 cash. In the books of BBB, the Investment in Joint Operation account on May 30, 2021 would show a balance of:
a. 45,750
b. 56,250
c. 54,250
d. 50,000
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- On May 1, 2021, AAA and BBB formed a joint operation to acquire and sell a special type of merchandise. The contractual arrangements provide that AAA is to manage the joint operation for a fee and that gain and losses are to be divided equally. On May 1, 2021, BBB invests cash of P52,000, which P50,000 was used to purchase merchandise. AAA incurs expenses amounting to P2,500. On May 20, one half of the merchandise was sold for P36,000 cash. In the books of BBB, the Investment in Joint Operation account on May 30, 2021 would show a balance of: 56,250 45,750 50,000 54,250In 2021, Detroit transferred goods to a retailer on consignment. The goods cost P450,000 and normally are sold at a 40% markup on cost. Detroit paid P5,000 for the cost of the shipment while the retailer paid P3,800 for advertising and P2,800 for the cost of freight out. The parties agreed that Freeshop would reimburse the cost of advertising and freight paid by the retailer. In 2021, the retailer at the normal markup, sold 80% of the merchandise and the balance of the merchandise was returned to Detroit. The retailer withheld 15% commission from payment plus the amount reimbursable by the consignor. Determine the net income earned by the consignor. A.62,650B.421,800C.56,800D.405,000In 2020, HP Company transferred goods to a retailer on consignment. The goods cost P450,000 and normally are sold at a 40% markup on cost. GGG paid P5,000 for the cost of the shipment while the retailer paid P3,800 for advertising and P2,800 for the cost of freight out. The parties agreed that GGG would reimburse the cost of advertising and freight paid by the retailer. In 2020, the retailer at the normal markup, sold 80% of the merchandise and the balance of the merchandise was returned to AAA and paid a freight of P2,500. The retailer withheld 15% commission from payment plus the amount reimbursable by the consignor. How much is the consignment net income?
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- On July 1, 2020, Splish Inc. made two sales. 1. It sold land having a fair value of $909,120 in exchange for a 4-year zero-interest-bearing promissory note in the face amount of $1,430,514. The land is carried on Splish's books at a cost of $597,100. 2. It rendered services in exchange for a 3%, 8-year promissory note having a face value of $401,050 (interest payable annually). Splish Inc. recently had to pay 8% interest for money that it borrowed from British National Bank. The customers in these two transactions have credit ratings that require them to borrow money at 12% interest.Record the two journal entries that should be recorded by Splish Inc. for the sales transactions above that took place on July 1, 2020.On August 1, 2019, Aiken Corp. enters into a contract with Benton Corp. to sell it $25,000 of goods. Aiken will deliver the goods on August 30, 2019, and Benton will pay the full amount upon acceptance. The goods were manufactured by Aiken at a cost of $18,000. Both Aiken and Benton consider the acceptance of the goods on August 30 a formality given that Benton has purchased the same goods from Aiken numerous times without incident. On August 30, 2019, Aiken delivers the goods and Benton transfers cash to Aiken. required: 1.Prepare the journal entries in August 2019 necessary to account for this transaction. Assume Aiken uses a perpetual inventory systemOn July 1, 2020, Agincourt Inc. made two sales. 1. It sold land having a fair value of $700,000 in exchange for a 4-year zero-interest-bearing promissory note in the face amount of $1,101,460. The land is carried on Agincourt’s books at a cost of $590,000. 2. It rendered services in exchange for a 3%, 8-year promissory note having a face value of $400,000 (interest payable annually). Agincourt Inc. recently had to pay 8% interest for money that it borrowed from British National Bank. The customers in these two transactions have credit ratings that require them to borrow money at 12% interest. Instructions Record the two journal entries that should be recorded by Agincourt Inc. for the sales transactions above that took place on July 1, 2020.
- On January 1, 2021 Simon Co. purchased an item of equipment for P600,000, including P50,000 refundable purchase taxes. The purchase price was funded by raising a loan of P605,000. In addition, the entity has to pay P5,000 in loan raising fees to the Bank. The loan is secured against the equipment. In January 2021 the entity incurred costs of P20,000 in transporting the equipment to the entity’s site and P100,000 in installing the equipment at the site. At the end of the equipment’s 10-year useful life the entity is required to dismantle the equipment and restore the building housing the equipment. The present value of the cost of dismantling the equipment and restoring the building is estimated to be P100,000. In January 2021 the entity’s engineer incurred the following costs in modifying the equipment so that it can produce the products manufactured by the entity: • Materials – P55,000 • Labour – P65,000 • Depreciation of plant and equipment used to perform the modifications –…In 2020, Shop Wholesalers transferred goods to a retailer on consignment. The goods cost P450,000 and normally sold at a 50% markup based on cost. Shop Wholesalers paid P5,000 for the cost of shipment while the retailer paid P2,800 for advertising and P800 for the cost of freight out. The parties agreed that Shop Wholesalers would reimburse the cost of advertising and freight paid by the retailer. In 2020, the retailer at the normal markup sold 60% of the merchandise, and the balance of the merchandise was returned to the consignor incurring freight of P1,200 paid by the consignor. The retailer withheld a 15% commission from payment plus the amount reimbursable by the consignor. The amount remitted by the retailer to the consignor is: the net income earned by the consignor on the shipment is:In 2021, a merchandise was sold on instalment basis by ONB for P80, 000 at a gross profit of 25% on cost. During this year, a total of P42, 500, including interest of P12, 500 was collected on this contract. In 2021, no collection was made on this sale, and the merchandise was repossessed. The fair value of the merchandise is P34, 000. Reconditioning cost amounts to P4, 000. What is the gain (loss) on reposition? a. 10, 000 b. (6, 000) c. (14, 000) d. (10, 000)