5.

On October 1,2009, Sandara Company assigned on a nonnotification basis accounts receivable of P6,000,000 to a bank in
consideration for a loan 75% of the receivables less a 2% service fee on the accounts assigned. The loan was evidenced by a 12%
note payable issued by Sandara to the bank. On December 31, 2009 Sandara collected assigned accounts of P3,500,000, allowing
sales discounts of P100,000 and remitted the entire collection to the bank in partial payment for the loan. The bank applied first
the collection to the Interest and the balance to the principal. In its December 31, 2009 financial statements, Sandara should
disclose its “equity In the assigned accounts” in the amount.
a. 1,265,000 b. 1,365,000 c. 1,400,000 d. 3,265,000

6. On February 1, 2010, Henson Company factored receivables with a carrying amount of P300,000 to Agee Company. Agee
Company assesses a finance charge of 3% of the receivables and retains 5% of the receivables. Relative to this transacton, you
are to determine the amount of loss on sale to be reported in the income statement of Henson Company for February.
Assume that Henson factors the receivables on a without recourse basis. The loss to be reported is
a. P0 b. P9,000 c. P15,000 d. P24,000

7.The physical inventory of Pangasian Company on December 31, 2009, showed merchandise with a cost of P4,000,000 was on
hand at that date. You also have discovered the following items were all excluded from the count:
a. Merchandise costing P160,000, which was held by Pangasinin on conslgment. The consignor Is a subsidiary.
b. A special machine, fabricated to order for a customer costing P400,000, was finished and specifically segregated in the bank
part of the shipping room on December 31, 2009. The customer was billed on that due date and the machine excluded from
inventory although it was shipped on January 4, 2010.
c. Merchandise costing P80,000, which was shipped by Pangasinan f.o.b. destination to a customer on December 31, 20O9. The
customer expects to receive the merchandise on January 3, 2010.
d. Merchandise costlng P120,000, which was shipped by Pangasinan f.o.b. shipping point to a customer on December 29,2009.
e. Merchandise costing P50,000 shipped by a vendor f.o.b shipping point on December 28, 2009 and received by Pangasinan on
January 10, 2Q10.
The corrected balance of Pangasinan’s inventory should be