Iris Company operates a retail store and must determine the proper December 31, 2014 year-end accrual for the following expenses: • The store lease calls for fixed rent of P12,000 per month payable at the beginning of the month, payable at the beginning of the month, and additional rent equal to 6% of net sales over P2,500,000 per calendar year, payable on January 31 of the following year. Net sales for 2013 are P4,500,000 • An electric bill of P8,500 covering the period December 16, 2014 through January 15, 2015 was received January 22, 2015. • A P4,000 telephone bill was received January 7, 2015, covering: Service in advance for January 2015................. P1,500 Local and toll calls for December 2014............ P 2,500 In its December 31, 2014 statement of financial position, Iris should report accrued liabilities of: A. 150,750 B. 131,000 C. 128,250 D. 126,750
Iris Company operates a retail store and must determine the proper December 31, 2014 year-end accrual for the
following expenses:
• The store lease calls for fixed rent of P12,000 per month payable at the beginning of the month, payable at the
beginning of the month, and additional rent equal to 6% of net sales over P2,500,000 per calendar year, payable on
January 31 of the following year. Net sales for 2013 are P4,500,000
• An electric bill of P8,500 covering the period December 16, 2014 through January 15, 2015 was received January
22, 2015.
• A P4,000 telephone bill was received January 7, 2015, covering:
Service in advance for January 2015................. P1,500
Local and toll calls for December 2014............ P 2,500
In its December 31, 2014 statement of financial position, Iris should report accrued liabilities of:
A. 150,750
B. 131,000
C. 128,250
D. 126,750
Step by step
Solved in 2 steps with 1 images
