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LIFO Perpetual Inventory

Portey uses a perpetual inventory system and had the following inventory transactions for the month of June: June 1 On hand, 100 units at $9.00 each $900.00 4 Purchased 120 units at $9.10 each $1,092.00 5 Sold 150 units 10 Purchased 100 units at $9.50 each $950.00

Inventory: EOQ Method

Analyzing the inventories including the raw material inventories, work-in-process, and finished goods: How could I apply the EOQ method? What are the implications of process set-up times? What would be other inventory issues that would occurring in the processes for the product line, i.e. costs, inventory turns, inventory accu

FIFO/LIFO Methods Net Income (After Tax)

Assume the Bullock Corporation had the following purchases and sales of its single product during its first three years of operation: purchases | sales year | unit | unit cost | unit |

Calculating EOQ and inventory costs

The president of the wholesale distributor has recently heard about the EOQ model and is interested in learning whether or not using this model would allow the company to reduce its annual costs by optimizing the number of orders placed each year and the number of toilets purchased in each order. The estimated annual demand for

Calculating the inventory costs.

A wholesale distributor stocks and sells low flow toilets to contractors for use in commercial office buildings. The estimated annual demand for the toilets is 4,475 units. The estimated average demand per day is 15 units. The purchase cost from the toilet manufacturer is $125.00 per unit. The lead time for a new order is 4

Effects of Intercompany Transactions at Consolidation

Chapter 5 introduces you to the intercompany sales of inventory, land, and depreciable assets as these transfers result in similar consolidation procedures. Discuss the effects of intercompany transactions when consolidating financial statements. Your discussion should include the effects on both the parent and the subsidiary.

Average aggregate Inventory Turnover

The Marlin Company operates 50 wks a year, and its cost of goods sold last year was $1,500,000. The firm carries six items in inventory: three raw materials, two work-in-process items, and one finished good. The following table shows the company's last year's average inventory levels for these items, along with their unit values

Display loss, damaged goods, and stolen inventory on a financial statement

I am attempting to display on a financial statement (balance sheet, income statement, and retained earnings) the recording of an inventory loss, damaged goods, and theft. I am unsure how to depict this. Do I use a T-account for each? I am responsible for creating the sheets and then writing about how the accounts are affected. I

Effects if Inventory Costing Methods on Income

Problem 7-36 Effects of Inventory Costing Methods on Income Martin Merchandising has hired you to examine whether the company should use the LIFO or FIFO inventory costing method. The company uses a perpetual inventory system and has supplied the following information for the month: Required: Prepare multi-step income sta

Inventory Costing Methods

Exercise 7-17 Inventory Costing Methods Hahn Hardware provides the following information relating to its June inventory activity. Hahn uses a perpetual inventory system. Required: a. Put Hahn's given information into a cost of goods sold model. What is unknown? b. Compute the ending inventory and cost of goods so

FIFO and LIFO review

- Discuss whether or not you believe that LIFO is a fair inventory valuation method. - Identify three different businesses and then state whether they would benefit most from the FIFO, LIFO or Weighted Average approach to accounting for their inventories. State a reason with your answer. - Discuss what procedures a company may

Journal entries: inventory, note payable, salary, unearned revenue

Prepare the following adjustments in good journal entry format. (a) The beginning balance of the Supplies account was $315. During the month the company bought additional supplies in the amount of $830. At the end of the month a physical inventory showed $568 of unused supplies. (b) The company has a Note Payable in the am

Inventory Cost Flow Methods

Accounting - Cost Flow Methods Which of the following three cost flow methods (FIFO, LIFO, Average) results in (1) the highest ending inventory amount for the balance sheet and (2) the highest cost of goods sold for the income statement? Additional information: Beginning Inventory 1,500 @ $7 March 5

Cost Flow Methods: FIFO and LIFO

Which cost flow method results in (1) the highest inventory amount for the balance sheet and (2) the highest cost of goods sold for the income statement? (1) (FIFO or LIFO) produces the highest inventory amount, $ =(how much) (2) (FIFO or LIFO) produces the highest cost of goods sold, $= (how much) Additional information:

Accounting Information System - Inventory Table

Please see the attachment. Using Excel, create an inventory table from the data in Table 1 below. Also include an Amount field and a Priority field. Both are calculated columns. Amount equals Inventory times Price. Create a Priority Code table in the range I1: J6 using the data shown in Table 2. Use the VLOOKUP function t

FiFO and LIFO Inventory

Wilmington Corporation reported the following in its 2009 annual report: 2008 2009 Inventories $ 87,200 $102,500 Accounts Payable $30,000 $38,800 Cost of products sold $300,000 Wilmington measures its inventory on a LIFO basis. The fo

Evaluating Evidence

Evaluating Evidence Gathering a combination of evidence helps auditors adequately evaluate risk. As an auditor, you will evaluate the evidence that has been gathered on Anthony's Orchard's inventory. Review the audit objectives and the substantive test procedure that was performed. Identify if the evidence can be classifie

Low Gross Profit and High Inventory Turnover

An acquaintance with an interest in investing says, "I would not invest in Company A because their gross profit percentage is low and their inventory turnover ratio is high." Is your acquaintance correct in their concerns?


During a period of rising inventory costs and stable output prices, describe how new income and total assets would differ depending upon whether LIFO or FIFO is applied. Explain how your answer would change if the company is experiencing declining inventory costs and stable output prices.


1. Inventory and cost of goods sold figures prepared under the LIFO cost flow assumption versus the FIFO cost flow assumption can differ dramatically. a. Would an analyst consider ending inventory asset value more useful if computed using LIFO or FIFO? b. Would an analyst consider cost of goods sold more useful if comput

Calculating Inventory Value Under FIFO Method

Holliday Company's inventory records show the following data: Units Unit Cost Inventory, January 1 5,000 $9.00 Purchases: June 18 4,500 8.00 November 8 3,000 7.00 A physical inventory on December 31 shows 2,000 units on hand. Holliday sells the units for $12 each. The company has an effecti

Inventory Methods - LIFO and FIFO

Thank you! K. Co. uses LIFO inventory method. At the end of the 2006 accounting period, the company reported $10,000 of net earnings on I/S. The inventory balance on the 2006 B/S is $7,000. In the footnotes, LIFO's reserve at the end of 2006 is $3,000 and LIFO's reserve at the end of 2005 is $2,500. JJ Co. uses FIFO and repor

Accounting: Calculating Inventory Costs and Equivalent Units

Horngren 9th Edition Chapter 17 Question P17A-11A Amy Electronics makes CD players in three processes: assembly, programing, and packaging. Direct materials are added at the beginning of the assembly process. Conversion costs are incurred evenly throughout the process. The assembly department had no work in process inventor

Convex Medical Supplies Inventory Control Exercise

Convex Mechanical Supplies produces a product with the following costs as of July 1, 2009: Material $6 Labor 4 Overhead 2 Total $12 Beginning inventory at these costs on July 1 was 5,000 units. From July 1 to December 1, Convex produced 15,000 units. These units had a material cost of $10 per unit. The costs for

Estimating ending inventory using the conventional method

Kiddie World uses a periodic inventory system and the retail inventory method. The following data are available for Kiddie World for the quarter ending September 30, 2011: Please see the attached file. Estimate ending inventory using the conventional method (average cost and the LCM approximation).

Kanban Card-Inventory

Applying your basic understanding of inventory control parameters, explain the factors that should influence the size of the kanban card, and the number of kanban cards that should be used for a given item.

Methods of accounting: FIFO versus LIFO

Explain how the choice of one of the following accounting methods over the other raises or lowers a company's net income during a period of continuing inflation. (a) Use of FIFO instead of LIFO for inventory costing. (b) Use of a 6-year life for machinery instead of a 9-year life. (c) Use of straight-l

Inventory: Planter's 2010 Annual Report

See attached sheet. Help with problem 5-4a please. Before releasing the 2010 annual report, Planter's controller learns that the inventory of one of the stores (amounting to $500,000) was counted twice in the December 31, 2009, inventory. The inventory was correctly counted in the December 31, 2010, inventory. Please see