MITCH T.

MINGLANA
BSA 301

PROBLEM 6: Compute for the net income did Irene realize in August on the
consignment

ANSWER AND SOLUTION:

Consignment Sales: 6,000 x 6 P 36, 000

Less: Applicable costs and expenses related
To consignment sales:

Consigner:
Costs of goods sold: P3, 000 x 6 P18, 000
Freight: P3, 000 x 6/10 P1, 800

Consignee:
Expenses P 2, 500
Commission P7, 200 P29, 500
NET INCOME P6, 500

PROBLEM 7:

1. Compute for the net income (loss) on consignment of Sony TV set

ANSWER AND SOLUTION:

Consignment sales P280, 000
Less: Applicable cost and
Expenses – charges related to consignment sales:
Cost of goods sold (P300, 000 x 7/10) P210, 000
Freight (P10, 000 x 7/10) P7, 000
Commission (10%x P280, 000) P28, 000
Cartage- in (P3, 500x 7/10) P2,450 P247, 450
NET INCOME P32, 550

2. Compute for the cost of inventory on consignment for Sony Tv set and DVD
Player

ANSWER AND SOLUTION:

Sony TV DVD player Total
 set
Cost of goods sold:
TV: 3/10 x P300,000 P90,000
DVD player: 2/5 x P275,000 P110,000 P200,000
Add:
Freight:
TV: 3/10 x P10,000 3,000
DVD player: 2/5 x P5,000 2,000 5,000
Cartage – in:
TV: 3/10 x P3,500 1,050
DVD player: 2/5 x P1,500 600 1,650

Total cost of inventory P94,050 P112,600 P206,650