You were engaged by Snooky Corp whose main warehouse is in Lipa City, for the audit of its financial statements ending December 31, 2017 The company is in the wholesale business and makes a mark up of 20 based on sales in all their sales The following are the unadjusted balances of their accountsrelated to its inventory in its trial balance Accounts ReceivableP 520,000 Inventory630,000 Accounts Payable410,000 PURCHASES SALES DATE REFERENCE AMOUNT DATE REFERENCE AMOUNT Balance Forwarded 1,400,000 Balance Forwarded 2,600,000 12 28 RR No 1114 12,000 12 27 SI No 1020 20,000 12 30 RR No 1116 35,000 12 28 SI No 1021 75,000 12 31 RR No 1117 21,000 12 28 SI No 1022 5,000 12 31 RR N0 1118 32,000 12 31 SI No 1023 50,000 12 31 Closing Entry ( 1,500,000) 12 31 SI No 1024 40,000 12 31 SI No 1025 34,000 12 31 SI No 1026 8,000 12 31 Closing Entry (2,832,000) You observed the physical inventory of goods in the warehouse on December 31, 2017, and were satisfied that it was properly taken When performing sales and purchases cut off test, you found that at December 31, the last Receiving Report (RR) that had been used ( for goods physically received as of December 31) was No 1117 and that no shipment has been made on Sales Invoice (SI) beyond no 1024 You also obtained the following additional information Not included in the warehouse physical inventory at December31 were goods which had been purchased and received on RR No 1115 but were physically segregated awaiting the receipt of the invoice, which was not received until the following year Cost was P 20,000 On the evening of December 31, there were two trucks in the company's warehouse Goods inside the trucks were not included in the physical count as of December 31 1 Truck No APC 321 was unloaded on January 2 of the following year and received on RR No 1117 The goods were shipped FOB Destination 2 Truck No ULI 341 was loaded and sealed on December 31 but left the company premises only on January 2 This order was sold per Sales Invoice No 1024 The goods were shipped FOB Shipping Point Sales Invoice no 1021 pertains to a shipment which was temporarily stranded at December 31 enroute to a client's customer The client's customer received the goods which were shipped FOB Lipa Enroute to the client on December 31 was a truckload of goods from supplier in Batangas were received on RR No 1119 The goods were shipped FOB Batangas, and freight of P 2,000 was prepaid by the said supplier Invocie price excluding freight amounted to P 54,000 The correct amount of sales for the year ended, December 31, 2017 is a P 2,750,000b P 2,742,000c P 2,675,000d P 2,667,000 The correct amount of purchasesfor the year ended, December 31, 2017 is a P 1,488,000b P 1,542,000c P 1,522,000d P 1,574,000 The correct inventory balance as of December 31, 2017 is a P 737,000b P 739,000c P 757,000d P 759,000 The correct Accounts Receivable balance as of December 31, 2017 is a P 446,000b P 478,000c P 363,000d P 438,000 The correct Accounts Payable balance as of December 31, 2017 is a P 454,000b P 434,000c P 452,000d P 432,000

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You were engaged by Snooky Corp. whose main warehouse is in Lipa City, for the audit of its financial statements ending December 31, 2017. The

You were engaged by Snooky Corp. whose main warehouse is in Lipa City, for the audit of its financial statements ending December 31, 2017. The company is in the wholesale business and makes a mark-up of 20% based on sales in all their sales. The following are the unadjusted balances of their accountsrelated to its inventory in its trial balance.

Accounts ReceivableP 520,000

Inventory630,000

Accounts Payable410,000

PURCHASES

SALES

DATE

REFERENCE

AMOUNT

DATE

REFERENCE

AMOUNT

Balance Forwarded

1,400,000

Balance Forwarded

2,600,000

12.28

RR No. 1114

12,000

12.27

SI No. 1020

20,000

12.30

RR No. 1116

35,000

12.28

SI No. 1021

75,000

12.31

RR No. 1117

21,000

12.28

SI No. 1022

5,000

12.31

RR N0. 1118

32,000

12.31

SI No. 1023

50,000

12.31

Closing Entry

( 1,500,000)

12.31

SI No. 1024

40,000

12.31

SI No. 1025

34,000

12.31

SI No. 1026

8,000

12.31

Closing Entry

(2,832,000)

You observed the physical inventory of goods in the warehouse on December 31, 2017, and were satisfied that it was properly taken.

When performing sales and purchases cut-off test, you found that at December 31, the last Receiving Report (RR) that had been used ( for goods physically received as of December 31) was No. 1117 and that no shipment has been made on Sales Invoice (SI) beyond no. 1024. You also obtained the following additional information:

Not included in the warehouse physical inventory at December31 were goods which had been purchased and received on RR No.1115 but were physically segregated awaiting the receipt of the invoice, which was not received until the following year. Cost was P 20,000.
On the evening of December 31, there were two trucks in the company's warehouse . Goods inside the trucks were not included in the physical count as of December 31:

1.Truck No. APC 321 was unloaded on January 2 of the following year and received on RR. No. 1117. The goods were shipped FOB Destination.

2.Truck No. ULI 341 was loaded and sealed on December 31 but left the company premises only on January 2. This order was sold per Sales Invoice No. 1024. The goods were shipped FOB Shipping Point.

Sales Invoice no. 1021 pertains to a shipment which was temporarily stranded at December 31 enroute to a client's customer. The client's customer received the goods which were shipped FOB Lipa.
Enroute to the client on December 31 was a truckload of goods from supplier in Batangas were received on RR No. 1119. The goods were shipped FOB Batangas, and freight of P 2,000 was prepaid by the said supplier. Invocie price excluding freight amounted to P 54,000.