On December 31, 2009, West Company had the following cash balances:

Cash in banks P1, 800,000

Petty cash funds (all funds were reimbursed on 12/31/09) P50, 000

Cash in banks includes P600, 000 of compensating balances against short-term borrowing arrangements at December 31, 2009. The compensating balances are not legally restricted as to withdrawal by West's December 31, 2009, balance sheet (statement of financial position), what total amount should be reported as cash?

a. P1, 850,000

b. P1, 250,000

c. Answer not given

d. P1, 200,000

e. P1, 800,000