The home office of Glendale Company, which uses the perpetual inventory system, bills shipments of merchandise to the Montrose Branch at a markup of 25% on the billed price. On August 31, 2016, the credit balance of the home office’s Allowance for Overvaluation of Inventories – Montrose Branch ledger account was P60,000. On September 17, 2016, the home office shipped merchandise to the branch at a billed price of P400,000. The branch reported an ending inventory, at billed price, of P160,000 on September 31, 2016. Compute the realized gross profit for the month of September 2016:
The home office of Glendale Company, which uses the perpetual inventory system, bills shipments of merchandise to the Montrose Branch at a markup of 25% on the billed price. On August 31, 2016, the credit balance of the home office’s Allowance for Overvaluation of Inventories – Montrose Branch ledger account was P60,000. On September 17, 2016, the home office shipped merchandise to the branch at a billed price of P400,000. The branch reported an ending inventory, at billed price, of P160,000 on September 31, 2016. Compute the realized gross profit for the month of September 2016:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The home office of Glendale Company, which uses the perpetual inventory system, bills shipments of merchandise to the Montrose Branch at a markup of 25% on the billed price. On August 31, 2016, the credit balance of the home office’s Allowance for Overvaluation of Inventories – Montrose Branch ledger account was P60,000. On September 17, 2016, the home office shipped merchandise to the branch at a billed price of P400,000. The branch reported an ending inventory, at billed price, of P160,000 on September 31, 2016.
Compute the realized gross profit for the month of September 2016:
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