Problem 13-15 (AICPA Adapted)On April 30, 2020, a fire damaged the office of WaterlooCompany.The following balances were gathered from the general ledgeron March 31, 2020:Accounts receivableInventory - January 1Accounts payableSalesPurchases920,0001,880,000950,0003,600,0001,680,000An examination of the April bank statement and canceledchecks revealed checks written during the period April 1-30;240,00080,000160,000Accounts payable as of March 31April merchandise shipmentsЕxрensesDeposits during the same period amounted to P440,000which consisted of collections from customers with theexception of P20,000 refund from a vendor for merchandisereturned in April.Customers acknowledged indebtedness of P1,040,000 atApril 30. Customers owed another P60,000 that will neverbe recovered.Of the acknowledged indebtedness, P40,000 may proveuncollectible.Correspondence with suppliers revealed unrecordedobligations at April 30 of P340,000 for April merchandiseshipment, including P100,000 for shipments in transit onthat date.* The average gross profit rate is 40%.* Inventory with a cost of P260,000 wasfor P140,000.salvaged and soldThe balance of the inventory was a total loss.378 , What is the total amount of purchases up to April 30?a. 1,760,000b. 2,100,000c. 2,020,000d. 1,680,000

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Answered: , What is the total amount of purchases…

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, What is the total amount of purchases up to April 30? 1 760 000

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

Problem 13-15 (AICPA Adapted)
On April 30, 2020, a fire damaged the office of Waterloo
Company.
The following balances were gathered from the general ledger
on March 31, 2020:
Accounts receivable
Inventory - January 1
Accounts payable
Sales
Purchases
920,000
1,880,000
950,000
3,600,000
1,680,000
An examination of the April bank statement and canceled
checks revealed checks written during the period April 1-30;
240,000
80,000
160,000
Accounts payable as of March 31
April merchandise shipments
Еxрenses
Deposits during the same period amounted to P440,000
which consisted of collections from customers with the
exception of P20,000 refund from a vendor for merchandise
returned in April.
Customers acknowledged indebtedness of P1,040,000 at
April 30. Customers owed another P60,000 that will never
be recovered.
Of the acknowledged indebtedness, P40,000 may prove
uncollectible.
Correspondence with suppliers revealed unrecorded
obligations at April 30 of P340,000 for April merchandise
shipment, including P100,000 for shipments in transit on
that date.
* The average gross profit rate is 40%.
* Inventory with a cost of P260,000 was
for P140,000.
salvaged and sold
The balance of the inventory was a total loss.
378

, What is the total amount of purchases up to April 30?
a. 1,760,000
b. 2,100,000
c. 2,020,000
d. 1,680,000

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