Question: Kavya Co. had installment sales of $1,000,000 and cost of installment sales of $700,000 in 2004. A 2004 sale resulted in a default in 2006, at which time the balance of the installment receivable was $30,000. The repossessed merchandise had a fair value of $15,000. ➤ Calculate the rate of gross profit on 2004 installment sales.
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- Lovebirds Corporation sells goods on the installment basis. For the year ended December 31, 2011, the following were reported: Cost of installment sales P525,000 Loss on repossessions 13,500 Fair value of repossessed merchandise 112,500 Account defaulted 180,000 Deferred gross profit, December 31 108,000 How much was collected during the year?a. 210,000b. 264,000c. 390,000d. 415,715The data below are taken from the records of True Value Appliance Co. which sells appliances exclusively on installment basis: 2001 2002 2003 Installment sales Gross profit rate P365,500 36% P417,800 39% P610,750 40% The balance in the Installment Accounts Receivable controlling accounts at the beginning and end of 2003 were: January 1 P17,400 205,400 December 31 2001 P25,800 306,250 There was one repossession recorded during 2003. It related to 2002 sales. Thereafter, the repossessed appliance was sold for P200, which equaled the uncollected balance in 2002 2003 the customer's installment account receivable. 1. For the year ended December 31, 2003, the cost of goods sold for True Value Appliance Co. Amounted to? 2. The gross profit realized in 2003 on collections of 2001 and 2002 installment accounts receivable totaled? 3. In addition to above realized gross profit, there was also a gain from the sale of the repossessed appliance of?(A) How much should be recorded as the purchase price of the individual PPE items: 1. Equipment has an invoice price of P1,000,000, and a credit term of 2/30, n/60. Cash discount was not taken. 2. Paid cash of P200,000 and issued a note for the purchase of a machinery. The note has a face value of P1,000,000 due after three years and an effective interest rate of 7%. 3. Five units of equipment was purchased through the issuance of 1,000 pieces of P1,000 par-value shares. Each equipment has a fair value of P300,000 while a share is valued at P1400. 4. Issued bonds with face value of P5,000,000 and fair value of P5,100,000 to purchase equipment with a fair value of P4,900,000. 5. The old equipment has an original cost of P1,500,000, accumulated depreciation of P600,000, and fair value of P1,000,000. The new equipment obtained through exchange has a fair value of P1,200,000. The balance was
- Bramble Corp. sold $132000 of goods and accepted the customer's $132000 9%, 1-year note receivable in exchange. Assuming 9% approximates the market rate of return, what would be the debit in this journal entry to record the sale? Debit Notes Receivable for $120120. No journal entry until cash is collected. Debit Notes Receivable for $132000. Debit Accounts Receivable for $132000.20. Problem Solving. ABC has an accounts receivable with a gross amount of P150,000 and 2% allowance to be doubtful. ABC sold this account to nC20 Finance Inc for 95% of the carrying value of accounts receivable under a casual agreement. nC20 also charges a factoring fee and commission of 2% of the carrying value. Determine the amount to be recognized as loss from factoring. Round off final answer to the nearest peso.How much should be recorded as the purchase price of theindividual PPE items: 1. Equipment has an invoice price of P1,000,000, and a creditterm of 2/30, n/60. Cash discount was not taken. 2. Paid cash of P200,000 and issued a note for the purchase ofa machinery. The note has a face value of P1,000,000 dueafter three years and an effective interest rate of 7%. 3. Five units of equipment was purchased through theissuance of 1,000 pieces of P1,000 par‐value shares. Eachequipment has a fair value of P300,000 while a share isvalued at P1400. 4. Issued bonds with face value of P5,000,000 and fair value ofP5,100,000 to purchase equipment with a fair value ofP4,900,000. 5. The old equipment has an original cost of P1,500,000,accumulated depreciation of P600,000, and fair value ofP1,000,000. The new equipment obtained throughexchange has a fair value of P1,200,000. The balance was settled with cash. The exchange will not affect the future cashflows of the entity.
- 19. Sound Co. uses the "cost recovery method." The records of Sound Co. show the following information on a sale made on December 31, 20x1: Carrying amount of goods sold Consideration from sale: Cash down payment 10% Note payable a. 540,000 b. 1,440,000 600,000 5,400,000 The 10% note payable is due in nine annual installments of P600,000 beginning December 31, 20x2. The December 31, 20x2 installment was paid as scheduled, together with the interest of P540,000. What amount of income should Sound Co. recognize in 20x2 from the sale and the financing? Sales 20,000 30,000 Cost of Sales collections: From 20x1 sales From 20x2 sales 4,000,000 6,000,000 14,000 c. 1,960,000 20. Cold Breeze Co. uses the "cost recovery method." Relevant information follows: 20x1 20x2 16,000 18,000 Cash 6,000 24,000 d. 0 How much is the gross profit recognized by Cold Breeze in 20x2? a. 4,000 b. 6,000 c. 10,000 d. 0Please Help22. A company purchased land by signing a note with the seller, requiring down payment of P100,000, payment of P120,000 one year from purchase, and P80,000 three years from purchase. The note is non-interest bearing, but the going rate of similar notes is 10%. Present value of 1 at 10% for 1 period is 0.91. Present value of 1 at 10% for 3 periods is 0.75.
- Note 2 indicates that, “Inventories valued on the LIFO basis totaled ¥94,578 million and¥50,037 million at 31 December 2008 and 2009, respectively.” Based on this, the LIFOreserve should most likely:A. increase.B. decrease.C. remain the same.TRUE OR FALSE 1. Under the "installment sales method," the realized gross profit is equal to the gross profit rate multiplied by collection on sale. 2. Under the "installment sales method," the deferred gross profit at any given point of time may be determined by multiplying the balance of receivable by the gross profit rate. Fact pattern:Monkey Co. uses the "installment sales method." Monkey buys a banana for P2 and sells it for P10. 3. If Monkey collects Pl from the sale, Monkey's realized gross profit is PO.50. 4. If the ending balance of Monkey's installment receivable is P5, the deferred gross profit is P4. 5. If the ending balance of Monkey's installment receivable is P3, the total collections during the period must be P7.How much is the amortized cost on December 31, 2020?