Determine the following as a result of your audit: (Please show your solution) 1. How much is the amount of inventory presented in the 2020 statement of financial position? 2. How much is the amount of cost of sales reported in its 2020 statement of comprehensive income, assuming the company uses the direct method?

Valentines Company uses the periodic average method in calculating cost of goods sold for the three products that the company handles. Product A is being sold at P8 per unit, Product B is being sold at P11 per unit while Product C is being sold at P2 per unit. Inventories and purchases information concerning the three products are shown below: Product A Product B Product C Beginning Inventory 50,000 units @ P6.00 30,000 units @ P10.00 65,000 units @ P1.00 January - June Purchases 70,000 units @ P6.50 45,000 units @ P10.50 30,000 units at P1.10 July - December Purchases 30,000 units @ P8.00 January - December Sales 105,000 units 50,000 units 45,000 units On December 31, 2020, the suppliers reduced their prices from the most recent purchase prices by 20%, 10% and 5% for Products A, B and C respectively. Accordingly, Valentines decided to reduce their selling price by 10% effective January 1, 2021. Costs to sell each product is at 10% of the selling price Normal profit margins of A, B and Care 30%, 30% and 15% of selling price after selling costs, respectively