Purchases

Gross Purchases
xx
Add: Freight In
Less: Purchase Returns and Allowances
(xx)
Purchase Discount
(xx)
Net Purchases
Sales
Gross Sales
Less: Sales Return and Allowances
(xx)
Sales Discount
Net Sales

1.

xx

(xx)
xx

Cost of Goods Sold

Beginning Inventory
xx Add: Net Purchases
Cost of Goods Available for Sale
Less: Ending Inventory
(xx)
Cost of Goods Sold
xx
xx
Net Income
Net Sales
xx
Less: Cost of Goods Sold
(xx)
Gross Profit
xx
Less: Selling and Administrative Expense
(xx)
Net Income Before Tax
Less: Tax
(xx)
Net Income After Tax

xx
xx
xx

xx
xx

Clam Company provided the following for the current year:

Beginning inventory
P 32,000
Plus net purchases
Purchases
230,000
Plus: Freight-in
16,000
Less: Purchase discounts
(6,000)
Less: Purchases returns
(8,000)
232,000
Cost of goods available for sale
264,000
Less: Ending inventory
(40,000)
Cost of goods sold
224,000

The Company sold 30,000 units of inventory with a selling price of P20 per unit. The selling and
administrative expenses are P20,000 and P25,000 respectively. The income tax rate is 30%.
What is the net income after tax?
Sales (30,000 units x P20)
Less: Cost of Goods Sold
Gross Profit
Less: Selling Expense
Administrative Expense
Net Income Before Tax
Less: Tax (331,000 x 30%)
Net Income After Tax

P600,000
(224,000)
376,000
(20,000)
(25,000)
331,000
(99,300)
231,700

2.
Beginning inventory
Cost of goods sold
Ending inventory
Cost of goods available for sale
Purchases (gross)
Purchase discounts
Purchase returns
Freight-in
2014
Beginning Inventory
Add: Net Purchases
Gross Purchases
Add: Freight In
Less: Purchase Returns
Purchase Discounts
Cost of Goods Available for Sale
Less: Ending Inventory
Cost of Goods Sold
2015
Beginning Inventory
Add: Net Purchases
Gross Purchases
Add: Freight In
Less: Purchase Returns
Purchase Discounts
Cost of Goods Available for Sale
Less: Ending Inventory
Cost of Goods Sold
2016
Beginning Inventory
Add: Net Purchases
Gross Purchases
Add: Freight In
Less: Purchase Returns
Purchase Discounts
Cost of Goods Available for Sale
Less: Ending Inventory
Cost of Goods Sold

2014
275,000(1)
627,000
249,000 (2)
876,000
630,000
18,000
24,000
13,000

2015
249,000 (3)
621,000
225,000
846,000 (4)
610,000 (5)
15,000
30,000
32,000

275,000
630,000
13,000
(24,000)
(18,000)
601,000
876,000
249,000
627,000

249,000
610,000
32,000
(30,000)
(15,000)
597,000
846,000
225,000
621,000

225,000
585,000
16,000
(14,000)
(12,000)
575,000
800,000
216,000
584,000

2016
225,000 (6)
584,000 (7)
216,000
800,000
585,000
12,000 (8)
14,000
16,000