Jessie Corporation consigned 400 dresses to Anne Fashions a. P 0 c.

P70,300
at a suggested retail price of P500 each. Jessie paid freight b. P81,700 d. P69,375
charges of P2,000 on the shipment on consignment. Anne
paid delivery charges of P2,100 for units sold, subject to Passionate Enterprises consigned 15 dozens of fine men’s
subsequent settlement. Jessie and Anne agreed that any suits with a cost of P800 a suit to Fashion Treats Company.
sales in excess of the suggested retail price will accrue to Passionate incurred freight cost of P35 per dozen. As
the latter. Anne submitted an account sales on the sale of required by the agreement, Fashion Treats reported sales
215 dresses, 40% of which was sold at P580 each and the of 8 dozens at P1,200 a suit and reimbursable expenses of
rest at P640 each, All these sales were paid in cash. P2,500. Fashion Treats remitted the proceeds to
Jessie’s cost is P375 each dress, before any deferred costs Passionate, net of the agreed 15% commissions on sale.
on consignment are taken into account.
7. How much cash was remitted by Fashion Treats to
1. How much should Anne remit to Bryan for the Passionate Enterprises?
aforementioned sales to customers? a. P139, 800 c. P 95,420
a. P105,400 c. P107,500 b. P142,500 d. P142,800
b. P130,340 d. P132,440
8. How much was the consignment profit to Passionate
2. The journal entry to be recorded by Anne for the Enterprises?
remittance to Jessie, assuming profits are separately a. P 55, 590 c. P 18,430
determined and Anne uses the Consignment-in b. P 58,590 d. P 18,340
account, will include
a. a debit to Consignment-in of P107,500 9. How much is the Inventory of consigned goods after
b. a credit to commissions revenue of P24,940 the above mentioned sales?
c. a credit to cash of P105,400 a. P 67, 445 c. P 67,545
d. a credit to Consignment-in of P2,100 b. P 67,544 d. P 65,744

3. How much is the commission earned by Anne from Aircon, Inc. consigned 10 one-horse power air conditioner
sales of the consigned goods? units to Argy Trading and paid P2,000 freight out. Gross
a. P 13, 236 c. P 24,940 margin is 12.5% of sales. The consignee is allowed a
b. P 49,800 d. P 82,560 commission of 5% on sales. Argy Trading submitted an
account sales on December 31, 2017 as follows:
4. The cost of consigned goods to Jessie for the units
sold by Anne to customers was Sales P 72,000
a. P 81, 700 c. P 87,100 Less: Advances to consignor P 10,000
b. P100,654 d. P106,50 Selling expenses 800
Delivery and 1,200
5. The cost of the unsold 185 dresses still held by Anne is installation cost
shown at what amount in Anne’s Consignment-in Commission 3,600 15,600
account? Net remittance P 56,400
a. P69,375 c. P70,300
b. P81,700 d. P 0 10. How much is the net profit or loss of Aircon, Inc. in the
consignment?
6. The balance of the consignment-out account in the a. P 1,400 profit c. P 2,200 profit
books of Jessie after adjustment for recognized profit b. P 8,800 loss d. P 720 loss
will be

 - end of AFAR.2407 - 

DO IT YOURSELF DRILL

A Consignment Out account on the books of Consignor Inc. a. P 14, 300 c. P 15,380
appears below b. P 19,700 d. P 21,600
Consignment Out – Consignee Sales
Jan. 3 Shipped 12 P16,800 Jan 31 P21,600 4. The inventory of consigned goods is
sets Sales, 9 a. P 2, 800 c. P 4,200
sets b. P 4,560 d. P 4,810
3 Freight charges 1,440
31 Charges by Philacor consigned 12 refrigerator units to Ocampo
consignee Emporium. The cost is P6,000 each and the consignor paid
Delivery exp. 900 P720 for the freight to Ocampo. The consignee rendered
Commission(20%) 4,320 an account sales for the 5 refrigerator units it sold at
Advertising 1,000 P7,700 per unit. It deducted the following items:
Commissions at 10% of sales net of commission
1. The consignment profit realized by Consignor, Inc. on
Marketing expense of 10% of commission
the consignment during the month was
Delivery and installation cost of P30 per unit.
a. P 1,700 c. P 3,360 5. How much is the net profit of the consignor?
b. P 4,340 d. P 4,800 a. P 3, 815 c. P 37,780
b. P 4,200 d. P 3,395
2. The adjusted balance of the Consignment-Out account
after recognition of the net profit will be 6. How much is the net remittance of the consignee?
a. P 6,450 c. P 4,560 a. P 34, 500 c. P 4,200
b. P 4,605 d. P 6,540 b. P 4,500 d. P 33,780

3. The amount of cash remitted by Consignee was

7. How much is the balance of the Consignment-Out
account after recognizing the net profit computed in
Item 15?
a. P 34,500 c. P 33,780
b. P 37,780 d. P 42,420

8. How much is the balance of the Consignment-In

account in the books of the consignee after its cash
remittance in full to the consignor?
a. P 0 c. P37,780
b. P42,420 d. P34,500

9. The entry to be recorded by the consignor to recognize

its net profit from this consignee will include
a. A debit to Consignment-Out of P4,200
b. A credit to Consignment Profit of P4,800
c. A debit to Consignment-Out of P4,800
d. A credit to Consignment-Out of P4,200

10. The deferred cost that will be recognized by the

consignor on its statement of financial position, from
the given information will be
a. P 42,420 c. P 37,780
b. P 37,840 d. P 33,780

11. The gross profit recognized by the consignor from the

consignee sales will be
a. P 4,200 c. P 8,200
b. P 4,800 d. P 8,420