Outlook Corporation sells gas stoves. Its sales had a total of P250,000 during its first year of operation. All its sales were installment sales and it managed to collect only P80,000 in the said year. Outlook repossessed one gas stove after a customer defaulted in payment. The balance of the receivable pertaining to the repossessed stove was P25,000 at the time of repossession. How much is the deferred gross profit at year end if the gross margin ratio is 25%? a. P145,000 c. P170,000 b. P36,250 d. P42,500
Outlook Corporation sells gas stoves. Its sales had a total of P250,000 during its first year of operation. All its sales were installment sales and it managed to collect only P80,000 in the said year. Outlook repossessed one gas stove after a customer defaulted in payment. The balance of the receivable pertaining to the repossessed stove was P25,000 at the time of repossession. How much is the deferred gross profit at year end if the gross margin ratio is 25%? a. P145,000 c. P170,000 b. P36,250 d. P42,500
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Outlook Corporation sells gas stoves. Its sales had a total of P250,000 during its first year of
operation. All its sales were installment sales and it managed to collect only P80,000 in the
said year.
Outlook repossessed one gas stove after a customer defaulted in payment. The balance of the
receivable pertaining to the repossessed stove was P25,000 at the time of repossession. How
much is the deferred gross profit at year end if the gross margin ratio is 25%?
a. P145,000 c. P170,000
b. P36,250 d. P42,500
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