Vincenzo Cassano Company sells one product, which it purchases from various suppliers. The trial balance at December 31, 2020, included the following accounts: Sales (100,000 units at P150) Sales discount Purchases Purchase discount P15,000,000 1,000,000 9,300,000 400,000 100,000 200,000 Freight in Freight out The inventory purchases during 2020 were as follows: Units Unit cost 20,000 30,000 40,000 50,000 10,000 150.000 Total cost P 1,200,000 1,950,000 2,800,000 3,750,000 800,000 P10.500,000 P60 Beginning inventory, January 1 Purchases, quarter ended March 31 Purchases, quarter ended June 30 Purchases, quarter ended Sept. 30 Purchases, quarter ended Dec. 31 65 70 75 80 Vincenzo Cassano's accounting policy is to report inventory in its financial statements a the lower of cost or market, applied to total inventory. Cost is determined under the first-in, first-out method. Vincenzo Cassano has determined that, at December 31, 2020, the replacement cost o its inventory was P70 per unit and the net realizable value was P72 per unit. The normal profit margin is P10 per unit. What should Vincenzo Cassano report as cost of goods sold for the year 2020?
Vincenzo Cassano Company sells one product, which it purchases from various suppliers. The trial balance at December 31, 2020, included the following accounts: Sales (100,000 units at P150) Sales discount Purchases Purchase discount P15,000,000 1,000,000 9,300,000 400,000 100,000 200,000 Freight in Freight out The inventory purchases during 2020 were as follows: Units Unit cost 20,000 30,000 40,000 50,000 10,000 150.000 Total cost P 1,200,000 1,950,000 2,800,000 3,750,000 800,000 P10.500,000 P60 Beginning inventory, January 1 Purchases, quarter ended March 31 Purchases, quarter ended June 30 Purchases, quarter ended Sept. 30 Purchases, quarter ended Dec. 31 65 70 75 80 Vincenzo Cassano's accounting policy is to report inventory in its financial statements a the lower of cost or market, applied to total inventory. Cost is determined under the first-in, first-out method. Vincenzo Cassano has determined that, at December 31, 2020, the replacement cost o its inventory was P70 per unit and the net realizable value was P72 per unit. The normal profit margin is P10 per unit. What should Vincenzo Cassano report as cost of goods sold for the year 2020?
Chapter18: Accounting Periods And Methods
Section: Chapter Questions
Problem 67P
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