PROBLEM I: Following is the income statement of XYZ Branch in Cebu City for the six-month period ending June 30, 2019: The Home Office ships merchandise to, and bills, the Branch Office at 125% of cost. The rent of the Branch Office for six (6) months, at a monthly rate of P1,000, was paid by the Home Office. 1. The Home Office net profit from its Branch Office in Cebu City, for the six (6) months ending June 30 , 2019 , is a. P125,000 c. P139,000 b.) P124,000 d. P109,000 2. The inventory of the Branch Office in Cebu City, at costs, as of June 30, 2019 is a. P85,000 b. P70,000 c.) P60,000 d. P 75,000