The Apollo Company conducted a physical count on December 31, 2021 which revealed in inventory with a cost of P4,410,000. The following items were excluded from the physical count: • Merchandise held by Apollo on consignment, P610,000. • Merchandise shipped by Apollo, FOB Destination to a customer on December 31, 2021 and was received by the customer on January 8, 2022, P380,000. • Merchandise shipped by Apollo, FOB Shipping Point to a customer on December 31, 2021 and was received by the customer on January 8, 2022, P460,000. • Merchandise shipped by a vendor, FOB Destination on December 31, 2021 was received by Apollo on January 8, 2022, P830,000. • Merchandise purchased FOB Shipping Point was shipped by the supplier on December 31, 2021 and received by Apollo on January 8, 2022, P510,000. What is the correct amount of inventory on December 31, 2021? O P3,800,000 P5,300,000 O P4,690,000 P4,920,000

The Apollo Company conducted a physical count on December 31, 2021 which revealed in inventory with a cost of P4,410,000. The following items were excluded from the physical count: • Merchandise held by Apollo on consignment, P610,000. • Merchandise shipped by Apollo, FOB Destination to a customer on December 31, 2021 and was received by the customer on January 8, 2022, P380,000. • Merchandise shipped by Apollo, FOB Shipping Point to a customer on December 31, 2021 and was received by the customer on January 8, 2022, P460,000. • Merchandise shipped by a vendor, FOB Destination on December 31, 2021 was received by Apollo on January 8, 2022, P830,000. • Merchandise purchased FOB Shipping Point was shipped by the supplier on December 31, 2021 and received by Apollo on January 8, 2022, P510,000. What is the correct amount of inventory on December 31, 2021? O P3,800,000 P5,300,000 O P4,690,000 P4,920,000

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Description: The Apollo Company conducted a physical count onDecember 31, 2021 which revealed in inventory with a costof P4,410,000.The following items were excluded from the physical count:• Merchandise held by Apollo on consignment, P610,000.• Merchandise ship

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.

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Question

The Apollo Company conducted a physical count on
December 31, 2021 which revealed in inventory with a cost
of P4,410,000.
The following items were excluded from the physical count:
• Merchandise held by Apollo on consignment, P610,000.
• Merchandise shipped by Apollo, FOB Destination to a
customer on December 31, 2021 and was received by
the customer on January 8, 2022, P380,000.
• Merchandise shipped by Apollo, FOB Shipping Point to
a customer on December 31, 2021 and was received by
the customer on January 8, 2022, P460,000.
• Merchandise shipped by a vendor, FOB Destination on
December 31, 2021 was received by Apollo on January
8, 2022, P830,000.
• Merchandise purchased FOB Shipping Point was
shipped by the supplier on December 31, 2021 and
received by Apollo on January 8, 2022, P510,000.
What is the correct amount of inventory on December 31,
2021?
P3,800,000
P5,300,000
P4,690,000
O P4,920,000

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