Problem 9-2 The trial balances before the adjustment for the home office and the branch of the Spade Company show the following items on December 31. Differences in the shipments account balances result from the home office policy of billing the branch for merchandise at 20% above cost. Allowance for overvaluation of branch merchandise Shipments to branch Purchases (outsiders) Shipments from home office Merchandise inventory, December 1 Home office books P36,000 P80,000 Branch books P 25,000 P 96,000 P150,000 Required: a. What part of the branch inventory as of December 1 represented purchases from outsiders and what part represented goods acquired from the home office?

Problem 9-2 The trial balances before the adjustment for the home office and the branch of the Spade Company show the following items on December 31. Differences in the shipments account balances result from the home office policy of billing the branch for merchandise at 20% above cost. Allowance for overvaluation of branch merchandise Shipments to branch Purchases (outsiders) Shipments from home office Merchandise inventory, December 1 Home office books P36,000 P80,000 Branch books P 25,000 P 96,000 P150,000 Required: a. What part of the branch inventory as of December 1 represented purchases from outsiders and what part represented goods acquired from the home office?

Name: Problem 9-2The trial balances before the adjustment for the home offi
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Description: Problem 9-2The trial balances before the adjustment for the home office and the branch of the SpadeCompany show the following items on December 31. Differences in the shipments accountbalances result from the home office policy of billing the branch

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 Inventory Systems Dubai Retail Company began operations in August and completed these transactions during the first month of operations. Aug. 1 Purchased OMR 8,000 of merchandise from V. Co. with terms of 2/10 n/30. Aug. 2 Paid OMR 200 in shipping costs for merchandise purchased from V. Co. Aug. 5 Returned OMR 500 of goods to V. Co. due to defects. Aug. 7 Sold OMR 8,000 of goods to C. Co. with terms of 3/10 n/40 (the goods cost OMR 5,000). Aug. 8 Paid V. Co. with check #844. Aug. 10 Purchased OMR 7,000 of goods for resale from W. Co. with terms 3/5 n/45. Aug. 11 C. Co. returned OMR 200 of merchandise. Aug. 12 Sold OMR 4,000 of merchandise to Ali Co. with terms 3/10 n/40 (the goods cost OMR 2,500). Aug. 14 Received full payment from C. Company. Aug. 25 Paid W. Co. in full. Aug. 28 Received full payment from Ali Co. Required: a. Prepare journal entries to record these transactions using perpetual inventory system. b. Prepare journal entries to record these transactions using…