ABC Company's has two merchandise outlets, its main store in Baguio City and its San Fernando City branch. For control purposes, all purchases aremade by the main store and shipped to the San Fernando City branch at cost plus 10%. on January 1, 2021, the inventories of the main store inBaguio City and the San Fernando City branch are P13,600 and P3,960, respectively. During 2021, the main store purchases merchandise costingP40,000 and shipped 40% of it to the San Fernando City branch. At December 31, 2021, the follawing journal entry to prepare the books for thenext accounting periad was prepared:Sales32,000Inventory4,840Inventory3,960Shipments from Main Store17,600Expenses10,480Main Store4,800Compute for the amount of overvaluation that was realized from the branch sales.

Branch costing means the different item or group of products are manufactured in the single entity…

Answered: t ABC Company's has

Business

Accounting

t ABC Company's has

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Software production costs related to computer software

A: As per FASB-Statement No. 86, costs incurred to create a computer software during research and…

Q: Is the statement True or False, explain: Commercial Registration creates the traders quality.

A: Commercial registration is done by the owner of company to get his/her company legally registered.…

Q: State a feature that distingues between a Non-trading Organization from a commercial organization.

A: Non-Trading OrganizationA business concern is an organization involved in activities of buying or…

Q: Branding may include O a. the brand name. O b. the brand mark. O c. the trade mark. d. All of the…

A: Brand and its features What does branding include

Q: Describe the characteristics of a world class company

Q: What objectives would you set for the company?

A: Objectives of a company means the mission or vision of the company for which the company operates…

Q: In a franchise arrangement, what are a franchisor’s typical performance obligations?

A: The franchise contract is recognized as a distinct series of performance obligations and essentially…

Q: Define brokerage firm

A: Brokerage is the charges that are paid by the client to the broker who helped in buying and selling…

Q: What are subsidiaries ledgers? Give three benefits of using subsidiaries ledgers?

A: Subsidiary ledger is a ledger account which records detailed information of the account which is…

Q: How the Alibaba company is different from most Western companies?

A: Alibaba Group’s mission is to make it easy to do business anywhere. Alibaba Group operate leading…

Q: resources of Boeing Company

Q: Explain primary market

A: Primary market is the market under which the securities of the companies are created. In the primary…

Q: Timex company

A: ANSWER- Bank Reconciliation Statement is a record book of the transactions of a bank account.…

Q: Explain how a company can use forward contracts to eliminateFX risk

A: Introduction: A forward contract is a contact between two parties regarding the future selling price…

Q: Illustrate to differentiate. 6. Block trades vs. basket trade.

A: When securities are bought or sold in large numbers then it is known as a block trade. When…

Q: Under what conditions must an enterprise provide information about products and services?

A: If operating segments of an enterprise have not been determined based on Differences in products and…

Q: Natural resources would include which of the following? O a.wind O b.steel Oc. labor Od.unleaded…

A: In this question we have four options and we require to choose the correct one with regard to…

Q: in which one of the following market, transaction regarding the Goods and Services appears on…

A: Financial market refers to the place where it provides a platform to the traders to buy or sell…

Q: What are the Industry economic characteristics of a company like Amazon?

A: Amazon is a multinational technology company that operates in a variety of industries, including…

Q: Explain professional corporation (PC)?

A: Professional Corporation An entity that is composed of the professionals of specific types that are…

Q: Using an imaginary company draft a conflict of interest policy for the entire organization

A: answer A conflict of interest policy is used to draft procedure for employees when a possible…

Q: What is meant by GAAG? Why should all companies follow GAAP in reporting to external users?

A: Generally Accepted Accounting Principles is what is meant by the abbreviation GAAP. Companies use…

Q: Why is it important for a company to operate cross-functionally?

A: Solution- Importance of cross-functional: 1-It is important for a company to operate…

Q: Benoit Company produces three products-A, B, and C. Data concerning the three products follow (per…

A: The contribution margin is calculated as the difference between sales and variable costs. The…

Q: What are some of the main differnces between IFRS and ASPE for business combinations?

A: The International Financial Reporting Standards (IFRS) and Accounting Standards for Private…

Q: Write T if the statement is correct and F if the statement is incorrect. On the space provided,…

A: Share certificate refers to the certificate of the document which is issued through the firm…

Q: Sales from one subsidiary to another are called: a. Horizontal sales b. Downstream sales c. Inter…

A: Sales refers to the exchange of a goods and services against money.

Q: companies

A: Plantwide costing is used to allocate their entire manufacturing overheads to their line of products…

Q: When a company expands by supplying independent business owners with an established business,…

A: Correct answer is Option: Business format franchise In a business format franchise, an organisation…

Q: Using one of the eight principles from the ACM/IEEE Code of Ethics, provide an example using the…

A: One of the eight principles from the ACM/IEEE Code of Ethics is the principle of "PRODUCT", which…

Q: Which of the below mentioned PPIs issued by an entity for facilitating the purchase of goods and…

A: PPI are prepaid financial instruments these have some value of money stored in them.

Q: Define Share Issue Costs.

A: Share: It represents the unit of ownership interest in a corporation. A capital of a company is…

Q: Under what conditions must an enterprise provide information about geographic areas?

A: Financial Statements: It refers to the end reports prepared by the organization at the end of the…

Q: what is enterprise value and enterprise value as a multiple EBITDA

A: Enterprise value-It is the measure of a company's total value. Enterprise value to EBITDA multiple…

Concept explainers

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.

Question

100%

ABC Company's has two merchandise outlets, its main store in Baguio City and its San Fernando City branch. For control purposes, all purchases are
made by the main store and shipped to the San Fernando City branch at cost plus 10%. on January 1, 2021, the inventories of the main store in
Baguio City and the San Fernando City branch are P13,600 and P3,960, respectively. During 2021, the main store purchases merchandise costing
P40,000 and shipped 40% of it to the San Fernando City branch. At December 31, 2021, the follawing journal entry to prepare the books for the
next accounting periad was prepared:
Sales
32,000
Inventory
4,840
Inventory
3,960
Shipments from Main Store
17,600
Expenses
10,480
Main Store
4,800
Compute for the amount of overvaluation that was realized from the branch sales.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

What are the similarities and differences between IPOs and direct listings?
What are the steps that would be needed for a company to transition from GAAP to IFRS?
Why is hedging relevant for a company?
Define Profi t and loss (P&L) statement
Which of the following allows consumers and suppliers to connect directly, removing the need for a third party? Select one: A. Gold Chain Technologies B. Black Chain Technologies C. Block Change Technologies O D. Block Chain Technologies
What is the best option for Hernandez Company and why?
There are three types oforganizations namelymanufacturing, services and tradingsectors, choose any one organizationfrom each sector of your choice andname 5 Assets, Liabilities,Expenses and revenue from them.
What is the case digest for Cosmo Entertainment Management Inc. vs. La Ville Commercial Corp.?
IN image: SMC is single member company and MMC is multiple member company
the modern thoery of trade is based in the principle of ?
Please explain Import/Export Fundamentals in details
WHich is the payment platform managed & Operated by NPCI a. RazorPay b. Mobikwik c. PayTM d. UPI