ACCOUNTING FOR SPECIAL TRANSACTION

ANSWER THE FOLLOWING AND SHOW SOLUTION

• The CCN Furniture ManufacturingCompany consigned 10unitsofdining table to a furniture dealer.The manufacturing costis P4,000 per piece.Consignment profits are not recorded separately by the company.At the end of the month, the dealer reported a sale of 4 units at P7,000 each and remitted the net sales proceeds after deducting the following:20% commission on units sold and P1,600 freight paid upon receipt of the 10 units.

Question 1 =How much was the cash remitted to the consignor?

Question 2=What is the balance of consignor's inventory relative to the consigned goods?

Question 3=How much was the net profit on consignment sales?

• On January 2, 2020, BEST BUY receivedfrom PHILACOR CORP.300 pieces ofoven toasters.BEST BUY was to sell these on consignment at 50% above cost per piece, and to receive a 15% commission on the selling price.After selling 200 units,BEST BUY had the remaining unsoldunits repaired for some electrical defects and spent P2,000 for the said repairs.PHILACOR CORP. consequently increased the selling price of the remaining units to P330 per unit.On January 31, BEST BUYremitted P64,980to PHILACORafter deducting 15% commission,P850for delivery expenses of sold units, and P2,000 for the repair of 100 units.The consigned goods cost PHILACORP200 per unit and shipping cost of P900 had been paid to ship to BEST BUY.All expenses in connection with the consignment were reimbursable to the consignee.

Question4 =How much is the consignment sales?

Question 5=How much is the consignment profit?

Question 6=What is the value of inventory on consignment?

• CAC Manufacturing consigned 10freezerstoNORTHERN TRADING.These freezers had a cost of P9,000 each.Freight on the shipment was paid by CAC in the amount of P6,000.NORTHERN TRADING submitted an account sales stating that it had sold6freezers and remitted the P68,250balance dueCACafter the following deductions from the selling price of the freezers:Commission, 15% of the selling price;marketing expenses, P4,500;Delivery and installation of items sold,P3,000;cartage cost paid upon receipt of consignment,P750.

Question 6=How much is the total sales?

Question 7 =How much is the consignor's net profit from the sale of the consigned goods?

Question 8 =How much is the commission earned on the sale of the 6 freezers by NORTHERN TRADING?