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An entity reported operating expenses other than interest expense for the year at 40% of cost of goods sold but only 20% of sales. Interest expense is 5% of sales. The amount purchased is 120% of cost of goods sold. Ending inventory is twice as much as the beginning inventory. The net income for the year is P2,100,000. The income tax is 30%. Question 1: What is the amount of sales for the year? a. 10,000,000 c. 18,000,000 b. 15,000,000 d. 12,000,000 Question 2: What is the amount of purchases? a. 6,000,000 c. 3,000,000 b. 7,200,000 d.3,600,000

An entity reported operating expenses other than interest expense for the year at 40% of cost of goods sold but only 20% of sales. Interest expense is 5% of sales. The amount purchased is 120% of cost of goods sold. Ending inventory is twice as much as the beginning inventory. The net income for the year is P2,100,000. The income tax is 30%. Question 1: What is the amount of sales for the year? a. 10,000,000 c. 18,000,000 b. 15,000,000 d. 12,000,000 Question 2: What is the amount of purchases? a. 6,000,000 c. 3,000,000 b. 7,200,000 d.3,600,000

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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An entity reported operating expenses other than interest expense for the year at 40% of cost of goods sold but
only 20% of sales. Interest expense is 5% of sales. The amount purchased is 120% of cost of goods sold. Ending
inventory is twice as much as the beginning inventory. The net income for the year is P2,100,000. The income
tax is 30%.
Question 1: What is the amount of sales for the year?
a. 10,000,000 c. 18,000,000
b. 15,000,000 d. 12,000,000
Question 2: What is the amount of purchases?
a. 6,000,000 c. 3,000,000
b. 7,200,000 d.3,600,000

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