What is the correct balance of inventory as of December 31, 2018? What is the correct 2018 gross profit? Stones Corporation is selling various products which are classified into three categories, depending on theirvalues. The goods are currently stored in the entity's warehouse located inside their premises. You were engagedto audit their financial statements as of and for the period ended December 31, 2018. An observation of physicalinventory count was conducted on December 30, 2018, and based on the count, the following information weregathered:UnitsCountedUnit CostTotal CostArea/ProductArea 001 (H Value Goods)Product 100A203103.0020,90917,938Product 100B175102.50Product 100C355101.0035.855Product 101A269100.0026,900Product 101B80499.5079,998Area 002 (M-Value Goods)Product 200A1,40074.00103,600Product 200B1,54473.60113,638Area 003 (L-Value GoodsiProduct 300AProduct 300BProduct 400A2,0002,04430.0060,00054,16626.502,03924.8050,567Product 400B3,1004,30022.3069,130Product 400C20.5088,150TotalTo determine the correct balance of your client's ending inventory, you obtained the following purchase and salesinvoices to ascertain whether there are inventory movements from December 26, 2018 to January 5, 2019:Purchase invoicesUnitTotalDate GoodsInvoice DateDec. 27, 2018were ReceivedГес. 31, 2018TermDate RecordedProductUnitsCostCostFOB Ship. Pt.FOB Ship. Pt.FоВ Dest.FОВ Dest.FOB Ship. Pt.Dec. 27, 2018Dec. 28, 2018Dec. 31, 2018Dec. 30, 2018Jan. 3, 2019Product 100A10102.501,025Product 100CProduct 101BDec. 27, 201820101.002,020Dec. 30, 2018Dec. 28, 2018Dec. 30, 201815100.001,5003,725Dec. 31, 2018Product 200A5074.50Jan. 3, 2019Dec. 31, 2018Product 200B5073.603,680Jan. 3, 2019Jan. 2, 2019FOB Dest.Jan. 2, 2019Product 400C20020.004,000Jan. 5, 2019Sules Invoices (all goods shipped on or before December 31, 2018 are still in transit as of Decemier 31, 2018)UnitInvoice DateDec. 26, 2018SellingPrice/u155.00Date ShippedDec. 25, 2018TermDate RecordedProductUnitsCostFOB Ship. Pt.Dec. 28, 2018Product 10OA20103.00Product 100BProduct 101EDec. 27, 2018FOB Dest.Dec. 28, 201810102.50148.00Dec. 27, 2018FOB Ship. Pt.FOB Ship. Pt.99.50Jan. 3, 2019Dec. 31, 2018Jan. 5, 2019Dec. 31, 2018Jan. 5, 201910141.00Product 100A20021.8051.00Dec. 31, 2018Audit notes:The company is using the FIFO method of accounting for their inventory.b. The beginning balance of their inventory is P834,500.The ending balances of their accounts reccivable and accounts payable are P659,300 andP521,100, respectively.Recorded purchases for the year total to P2,559,850, while sales total to P4,900,560.All purchases and sales are on account.a.C.d.e.

FOB Shipping: Title is passed to the buyer when the goods are transferred to the carrier and…

Stones Corporation is selling various products which are classified into three categories, depending on their values. The goods are currently stored in the entity's warehouse located inside their premises. You were engaged to audit their financial statenents as of and for the period ended December 31, 2018. An observation of physical inventory count was conducted on December 30, 2018, and based on the count, the following information were gathered: Units Counted Unit Cost Total Cost Area/Product Area 001 (H Value Goods) Product 100A 203 103.00 20,909 17,938 Product 100B 175 102.50 Product 100C Product 101A 355 101.00 35,855 269 100.00 26,900 Product 101B Area 002 (M-Value Goods) Product 200A Product 200B 804 99.50 79,998 1,400 74.00 103,600 1,544 73.60 113,638 Area 003 (L-Value Goods) Product 300A Product 300B Product 400A Product 400B Product 400C 2,000 2,044 30.00 60,000 54,166 26.50 2,039 3,100 4,300 24.80 50,567 22.30 69, 130 20.50 88,150 Total To determine the correct balance of your client's ending inventory, you obtained the following purchase and sales invoices to ascertain whether there are inventory movements from December 26, 2018 to January 5, 2019: Purchase invoices Unit Total Date Goods8 Invoice Date Dec. 27, 2018 Dec. 27, 2018 Date Recorded Product Product 100A Units 10 Cost 1,025 2,020 1,500 were Received. Dec. 31, 2018 Dec. 30, 2018 Term Cost 102.50 Dec. 27, 2018 FOB Ship. Pt. FOB Ship. Pt. FOB Dest. Dec. 28, 2018 Product 100C 20 101.00 Dec. 28, 2018 Dec. 31, 2018 Product 101B 15 100.00 Dec. 31, 2018 Jan. 3, 2019 Jan. 3, 2019 Dec. 30, 2018 FOB Dest. Dec. 30, 2018 Product 200A Product 200B 50 74.50 3,725 3,680 FOB Ship. Pt. Jan. 3, 20199 Jan. 2, 2019 Dec. 31, 2018 50 73.60 Jan. 2, 2019 FOB Dest. Product 400C 200 20.00 4,000 Jan. 5, 2019 Sules Invoices (all cpoods shiped on or befor: December 31, 2018 are still in transit as of December 31, 2018) Selling Price/u 155.00 Unit Invoice Date Dec. 26, 2018 Dec. 27, 2018 Dec. 31, 2018 Date Shipped Dec. 25, 2018 Dec. 27, 2018 Date Recorded Dec. 28, 2018 Units 20 Term Product Product 100A Product 100B Cost FOB Ship. Pt. 103.00 148.00 141.00 51.00 FOB Dest. Dec. 28, 2018 10 102.50 FOB Ship. Pt. FOB Ship. Pt. Dec. 31, 2018 Jan. 5, 2019 Product 101B 10 99.50 Jan. 3, 2019 Jan. 5, 2019 Produuet 400Λ 200 21.80 Dec. 31, 2018 Audit notes: a. The company is using the FIFO method of accounting for their inventory. b. The beginning balance of their inventory is P854,500. The ending balances of their accounts reccivable and accounts payable are P659,300 and P521,100, respectively. d. Recorded purchases for the year total to P2,559,850, while sales total to P4,900,560. All purchases and sales are on account. C. e.