Cutting Edge Co. is engaged in a small export business. The company maintains limited records. Most of the company's transactions are summarized in a cash journal; non-cash transactions are recorded by making memo entries. The following are abstracted from the company's records: Accounts receivable, increase Notes receivable, decrease Accounts payable, decrease Notes payable -trade, increase Notes payable - bank, increase Sales return (P200,000 was refunded) Sales discounts P1,480,000 800,000 600,000 800,000 1,200,000 320,000 80000 320,000 140,000 240,000 72,000 1,200,000 1,000,000 6,000,000 4,800,000 Purchase returns (P120,000 was refunded) Purchase discounts Accounts written-off Recovery of accounts written-off Cash sales Cash purchascs Cash received from account customers Cash payment to trade creditors

Cutting Edge Co. is engaged in a small export business. The company maintains limited records. Most of the company's transactions are summarized in a cash journal; non-cash transactions are recorded by making memo entries. The following are abstracted from the company's records: Accounts receivable, increase Notes receivable, decrease Accounts payable, decrease Notes payable -trade, increase Notes payable - bank, increase Sales return (P200,000 was refunded) Sales discounts P1,480,000 800,000 600,000 800,000 1,200,000 320,000 80000 320,000 140,000 240,000 72,000 1,200,000 1,000,000 6,000,000 4,800,000 Purchase returns (P120,000 was refunded) Purchase discounts Accounts written-off Recovery of accounts written-off Cash sales Cash purchascs Cash received from account customers Cash payment to trade creditors

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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Question

d. What is the total gross purchases on account?

e. What is the total gross purchases?

f. What is the net purchases?

Cutting Edge Co. is engaged in a small export business. The company maintains limited
records. Most of the company's transactions are summarized in a cash journal; non-cash
transactions are recorded by making memo entries. The following are abstracted from the
company's records:
Accounts receivable, increase
Notes receivable, decrease
Accounts payable, decrease
Notes payable -trade, increase
Notes payable – bank, increase
Sales return (P200,000 was refunded)
Sales discounts
P1,480,000
800,000
600,000
800,000
1,200,000
320,000
80000
Purchase returns (P120,000 was refunded)
Purchase discounts
320,000
140,000
Accounts written-off
240,000
72,000
1,200,000
1,000,000
6,000,000
4,800,000
Recovery of accounts written-off
Cash sales
Cash purchasces
Cash received from account customers
Cash payment to trade creditors

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Required (e) : Total Gross Purchase

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Required (d) : Total Gross Purchase On Account

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Required (f) : Total Net Purchase

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