RM, Inc. uses the gross method in recording for its purchases. However, for the year-end of 2020, they have revise it to net method. Total discounts available for purchases throughout the whole year are P20,000. From this,
RM, Inc. uses the gross method in recording for its purchases. However, for the year-end of 2020, they have revise it to net method. Total discounts available for purchases throughout the whole year are P20,000. From this,
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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RM, Inc. uses the gross method in recording for its purchases. However, for the year-end of 2020, they have revise it to net method. Total discounts available for purchases throughout the whole year are P20,000. From this, P2,000 is still available in the Accounts Payable. Balances before converting to net method include Purchases, P1,000,000, purchase discounts taken, P8,000, and accounts payable, P300,000. What amount should be reported as Accounts Payable for the year ended December 31, 2020?
A. P298,000
B. P272,000
C. P292,000
D. P282,000
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