ABC Company established a branch in Pasig on March 1, 2022. Shipments of merchandise at billed prices during March were as follows: March 5, 2022 (at 10% mark-up) P165,000 March 10, 2022 (at 20% mark-up) 240,000 March 20, 2022 (at 25% mark-up) 175,000 On March 21, 2022, the branch returned defective merchandise which was billed at P15,000 (received on March 20, 20221 The monthly report submitted by the branch to the home office for the month of March showed that unsold inventory was P196,000. The branch reported net income for the month of March of P49,500. How much is the true net income of the branch for March and how much is the allowance for overvaluation to be reported by the home office as of March 31, 2022?
ABC Company established a branch in Pasig on March 1, 2022. Shipments of merchandise at billed prices during March were as follows: March 5, 2022 (at 10% mark-up) P165,000 March 10, 2022 (at 20% mark-up) 240,000 March 20, 2022 (at 25% mark-up) 175,000 On March 21, 2022, the branch returned defective merchandise which was billed at P15,000 (received on March 20, 20221 The monthly report submitted by the branch to the home office for the month of March showed that unsold inventory was P196,000. The branch reported net income for the month of March of P49,500. How much is the true net income of the branch for March and how much is the allowance for overvaluation to be reported by the home office as of March 31, 2022?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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ABC Company established a branch in Pasig on March 1, 2022. Shipments of merchandise at billed prices during March were as follows:
March 5, 2022 (at 10% mark-up)
P165,000
March 10, 2022 (at 20% mark-up) 240,000
March 20, 2022 (at 25% mark-up)
175,000
On March 21, 2022, the branch returned defective merchandise which was billed at P15,000 (received on March 20, 20221 The monthly report submitted by the branch to the home office for the month of March showed that unsold inventory was P196,000. The branch reported net income for the month of March of P49,500.
How much is the true net income of the branch for March and how much is the allowance for overvaluation to be reported by the home office as of March 31, 2022?
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