Walang Kayo Company Question: Under accrual basis, what amount should be reported as gross sales for the current year?a. P6,650,000b. P6,600,000c. P6,350,000d. P6,550,000 Walang Kayo Company provided the following data:12/31/201912/31/2020P1,000,000InventorySalesP 600,0004,000,0002,400,0001,200,0001,500,000Cost of Goods SoldAccounts receivable- trade1,350,0001,850,000Accounts payable- tradeIn 2020, accounts written off amounted to P100,000. Sales returns with credit memo amounted toP150,000 and purchase returns, P50,000. Cash receipts from customers after P200,000 discounts totaledP6,000,000 while cash payments to trade creditors amounted to P4,000,000 after discount of P300,000.Cash paid to customers for goods returned was P50,000. On this transaction accounts receivable is debited.Under accrual basis, what amount should be reported as gross sales for the current year?

Gross sales are those sales which the company has made during the year which is in gross means the…

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Business

Accounting

Under accrual basis, what amount should be reported as gross sales for the current year?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Walang Kayo Company
Question: Under accrual basis, what amount should be reported as gross sales for the current year?

a. P6,650,000

b. P6,600,000

c. P6,350,000

d. P6,550,000

Walang Kayo Company provided the following data:
12/31/2019
12/31/2020
P1,000,000
Inventory
Sales
P 600,000
4,000,000
2,400,000
1,200,000
1,500,000
Cost of Goods Sold
Accounts receivable- trade
1,350,000
1,850,000
Accounts payable- trade
In 2020, accounts written off amounted to P100,000. Sales returns with credit memo amounted to
P150,000 and purchase returns, P50,000. Cash receipts from customers after P200,000 discounts totaled
P6,000,000 while cash payments to trade creditors amounted to P4,000,000 after discount of P300,000.
Cash paid to customers for goods returned was P50,000. On this transaction accounts receivable is debited.
Under accrual basis, what amount should be reported as gross sales for the current year?

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