Problem 1 Gemini Company started business at the beginning of the current year. The entity established an allowance for doubtful accounts estimated at 5% of credit sales. During the year, the entity wrote off P50,000 of uncollectible accounts. Further analysis showed that merchandise purchased amounted to P9,000,000 and ending merchandise inventory was P1,500,000. Goods were sold at 40% above cost. The total sales comprised 80% sales on account and 20% cash sales. Total collections from customers, excluding cash sales, amounted to P6,000,000. 1. What is the amount of cost of goods sold? 2. What is the amount of sales on account? 3. What is the net realizable value of accounts receivable at year-end?

Problem 1 Gemini Company started business at the beginning of the current year. The entity established an allowance for doubtful accounts estimated at 5% of credit sales. During the year, the entity wrote off P50,000 of uncollectible accounts. Further analysis showed that merchandise purchased amounted to P9,000,000 and ending merchandise inventory was P1,500,000. Goods were sold at 40% above cost. The total sales comprised 80% sales on account and 20% cash sales. Total collections from customers, excluding cash sales, amounted to P6,000,000. 1. What is the amount of cost of goods sold? 2. What is the amount of sales on account? 3. What is the net realizable value of accounts receivable at year-end?

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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uring the month of April, Orison Supply Store sold $39,000 of inventory, with $25,000 sold on credit and the remaining for cash. The business collected $15,000 from the previous month's credit sales that excluded a bad debt of $750. The inventory sold was purchased at a cost of $2,3400. What was the total revenue recognised in the month of September? (Ignore GST for this question)A. None of the other answers B. 54,000 C. 14,250 D. 38,250 E. 39,000
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Germo Company started business at the beginning of the current year. The entity established an allowance for doubtful accounts estimated at 5% of credit sales. During the year, the entity wrote off P50,000 of uncollectible accounts. Further analysis showed that the merchandise purchased amounted to P9,000,000 and ending merchandise inventory was P1,500,000. Goods were sold at 40% above cost. The total sales comprised 80% sales on account and 20% cash sales. Total collections from customers, excluding cash sales, amounted to P6,000,000. What is the amount of sales on account?
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