On October 1, 20x1, the warehouse of ABC Co. and all inventories contained therein were damaged by flood. Off-site back up base shows the following information:

Inventory, Jan. 1

10,000

Accounts payable, Jan. 1

3,000

Accounts payable, Sept. 30

2,000

Payments to suppliers

50,000

Freight-in

500

Purchase returns

500

Sales from Jan. to Sept.

80,000

Sales returns

5,000

Sales discounts

2,000

Gross profit rate based on sales 30%

Additional information:

Goods in transit as of October 1, 20x1 amounted to P1,000, cost of goods out on consignment is P1,200, and materials damaged by flood can be sold at a salvage value of P1,800. How much is the inventory loss due to the flood?

a.2,500

b.4,900

c.Answer not given

d.4,400

e.3,000