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Problem
Problem
Marissa Sales Corp. accounts for sales on the instalment basis. The balances of the control
accounts for instalment for instalment Contract Receivable of the beginning and of the end of
2014 were:
Instalment Contracts Receivable 2012
Instalment Contracts Receivable 2013
Instalment Contracts Receivable 2014
Jan. 1, 2014
24, 020
344, 460
-0-
During 2014. The company repossessed a refrigerator which had been sold in 2013 for P5,400
and P3,200 has been collected prior to default. The company sales and cost of sale figures are
summarized as follows:
Net Sales
Cost of Sales
2012
380, 000
247, 000
2013
432, 000
285, 120
2014
602, 000
379, 260
47. Marissa Sales Corp. values the repossessed goods at market value. The resale proce of
repossessed merchandise amounted to P1,700. The (1) gain or loss on repossession; and
(2) the total realized gross profit on instalments sales in 2014 amounted to:
a. (1) P(381) ; (2) P172, 852.50
b. (1) P(381) ; (2) P 71, 006.70
c. P174, 662.90
d. P339, 856.40