On July 1, an entity recorded purchases of P3,000,000 and P2,000,000 under credit terms of 2/15, net 30. The payment on the P3,000,000 purchase was remitted on July 16. The payment on the P2,000,000 purchase was remitted on July 31. What amount of purchases should be included in the determination of cost of goods available for sale?

1. Under gross method?

a. 5,000,000 b. 4,900,000 c. 4,940,000 d. 4,960,000

2. Under net method?

a. 5,000,000 b. 4,900,000 c. 4,940,000 d. 4,960,000