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The cost of goods sold section of the income statement prepared by your client for the year ended December 31 appears as follows: Inventory, January

The cost of goods sold section of the income statement prepared by your client for the year ended December 31 appears as follows:

Inventory, January 1
Purchases

P 80,000
1,600,000

Cost of goods available for sale
Inventory, December 31

1,680,000
100,000

Cost of goods sold

P1,580,000


Although the books have been closed, your working paper trial balance is prepared showing all accounts with activity during the year. This is the first time your firm has made an examination. The January 1 and December 31 inventories appearing above were determined by the physical count of the goods on hand on those dates and no reconciling items were considered. All purchases are at FOB shipping points.

In the course of your examination of the inventory cutoff, both at the beginning and end of the year, you discovered the following facts:

Beginning of the Year

1. Invoices totaling P25,000 were entered in the voucher register in January, but the goods were received during December.

2. December invoices totaling P13,200 were entered in the voucher register in December, but goods were not received until January.


End of the Year

3. Sales of P43,000 (cost of P12,900) were made on account on December 31 and goods were delivered at that time, but all entries relating to the sales were made on January 2.

4. Invoices totaling P15,000 were entered in the voucher register in January, but the goods were received in December.

5. December invoices totaling P18,000 were entered in the voucher register in December, but the goods were not received until January.

6. Invoices totaling P12,000 were entered in the voucher register in January, and the goods were received in January, but the invoices were dated December.


Based on the preceding information, determine the networking paper adjustment that should be made for each of the following accounts:

1. Retained earnings

2. Purchases

3. Beginning inventory

4. Accounts receivable

5. Sales


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