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6. The following information are extracted from the books and records of the Company and its branch. The balances are at December 31,2021, the third year of the corporation’s existence. (see image below). The branch acquires all of its merchandise from the home office. The inventories of the branch at billed prices on January 1, 2021 is P 90,000 and on December 31, 2021 is P100,800. Determine a. The percentage of profit on cost that the home office uses to bill merchandise shipped to branch and b. The balance of the Shipments to Branch account before the books are closed

6. The following information are extracted from the books and records of the Company and its branch. The balances are at December 31,2021, the third year of the corporation’s existence. (see image below). The branch acquires all of its merchandise from the home office. The inventories of the branch at billed prices on January 1, 2021 is P 90,000 and on December 31, 2021 is P100,800. Determine a. The percentage of profit on cost that the home office uses to bill merchandise shipped to branch and b. The balance of the Shipments to Branch account before the books are closed

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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6. The following information are extracted from the books and records of the Company and its branch. The balances are at December 31,2021, the third year of the corporation’s existence. (see image below). The branch acquires all of its merchandise from the home office. The inventories of the branch at billed prices on January 1, 2021 is P 90,000 and on December 31, 2021 is P100,800. Determine a. The percentage of profit on cost that the home office uses to bill merchandise shipped to branch and b. The balance of the Shipments to Branch account before the books are closed
Home Office Вooks Branch Books P 720,000 240,000 Sales Expenses Shipments from home office Allowance for overvaluation of branch inventory 432,000 P 87,000
Transcribed Image Text:Home Office Вooks Branch Books P 720,000 240,000 Sales Expenses Shipments from home office Allowance for overvaluation of branch inventory 432,000 P 87,000
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