Meg Company leased equipment from Wee Company on July 1, 2021 for an eight-year period expiring June 30, 2029. Equal payments under the lease are P600,000 and are due on July 1 of each year. The first payment was made on July 1, 2021. The rate of interest contemplated by Meg and Wee is 10%. The cash selling price of the equipment is P3,520,000 and the cost is P2,800,000. The lease is appropriately recorded as a sales type lease.

Compute the gross profit under each plan

Under the revenue recognition principle, when is revenue recorded?

Exercise 13-3 (Algo) Computing and analyzing trend percents LO P1 Sales Cost of goods sold. Accounts receivable 2021 $ 424,322 214,661 20,580 Numerator: 2020 $ 279,159 141, 180 16,303 2019 $ 218,948 112,924 15,042 Compute trend percents for the above accounts, using 2017 as the base year. For each of the three accounts, state whether the situation as revealed by the trend percents appears to be favorable or unfavorable. Trend Percent for Net Sales: 2021: 2020: 2019: 2018: 2017: Is the trend percent for Net Sales favorable or unfavorable? 2018 $ 153,648 78,724 8,973 Denominator: 2017 $ 116,400 58,200 7,973 11 Trend percent % % ge % % %