I need help answering the following two problems given in the attached information. (a) Prepare the inventory section of Maddox's balance sheet as of November 30, 2010, including any required note(s). (b) Without prejudice to your answer to (a), assume that the market value of Maddox's inventories is less than cost. Explai
KW Steel Corp. uses the LIFO method of inventory valuation. Waretown Steel, KW's major competitor, instead uses the FIFO method. See the attached. 1. Compute each company's 2011 gross margin percentage and inventory turnover using cost of goods sold ads reported by each company. (Round answers to one decimal place.) For each
Selected information concerning the operation of Kern company for the year ended December 31, 2011, is available as follows: Units produced 10,000 Units sold 9,000 Direct materials used 40,000 Direct labor incurred 20,000 Fixed factory overhead
MVP Corp uses LIFO to value its inventory. The 20x8 inventory records disclose the following: Beginning Inventory: Units Unit Cost First layer 10,000 $15 Second layer 22,000 18 Purchases 250,000 20 At December 26, 20x8, the company had a special, nonrecurring opportunity to purchase 40,000 units at $17 per unit. T
Nate's Grocery as January 1, 2012. The following events occurred in 2012. Assume that Nate's uses the periodic inventory method. Comprehensive cycle problem: period system (Appendix) The following trial balance pertains to Nate's Grocery as January 1, 2012. Account Title
W5-1 Journalize perpetual inventory entries (Chapter 5) Assume that on May 1, Jones Company had inventory that included a product called ADX-1023. The company uses a perpetual inventory system. During May, these transactions occurred. 8 Purchased ADX-1023 from ZXY Com
See the attached file. Ending Balance Beginning Balance Cash 18,000 17,000 Acts Receivable 59,000 44,000 Inventory 72,000 64,000 Property and Equip 64,000 50,000 Acts Payable 28,000 16,000 Bonds Payable 28,000 24,000 Common Stock 38,000 34,000 Additional Capital 54,000 50,000 Retained Earnings
LIFO versus FIFO - impact on ROI Natco, Inc uses the FIFO inventory cost flow assumption. In a year of rising costs and prices, the reported net income of $480,000 and average assets were $3,000,000. If Natco had used the LIFO cost-flow assumption in the same year, its cost of goods sold would have been $80,000 more than under
The following misstatements were detected by the auditor in performing substantive tests of inventories during the audit of Wixon Company. 1. Slow-moving, defective, and obsolete items are included in the inventory but not properly identified. Sampling for attributes is often used to allow an auditor to reach a conclusion concerning a rate of occurrence in a population. When an auditor samples for attributes, identify the factors that should influence the auditor's judgment concerning the determination of 1. acceptable level of risk of assessing control risk too low...
The following misstatements were detected by the auditor in performing substantive tests of inventories during the audit of Wixon Company. 1. Slow-moving, defective, and obsolete items are included in the inventory but not properly identified. Sampling for attributes is often used to allow an auditor to reach a conclusion concer
Zingle's buys and then resells a single product as its primary business activity. Following is information concerning the Zingle's inventory activity for the product during August 2004: August 1: 210 units on hand @5.10 per unit August 5: Sold 80 units August 7: Purchased 160 units @5.25 per unit August 11: Purchased 110 uni
1. Jackson Specialties has been in business for more than 50 years. The company maintains a perpetual inventory system, uses a LIFO flow assumption, and ends its fiscal year at December 31. At year-end, the cost of goods sold and inventory are adjusted to reflect periodic LIFO costing procedures. A railroad strike has delayed th
Listed below are several misstatements of inventory, accounts payable, and accrued liabilities accounts. Design a substantive audit procedure that provides reasonable assurance of detecting each misstatement. 1. A bonus earned by the president of the company has not been recorded. 2. Several accounts payable to vendors that the company has never purchased from before are omitted from the accounts payable listing. 3. When client employees counted the physical inventory, they included a number of items that were consigned to, but do not belong to, the company. 4. There is no disclosure in the financial statements that a large accounts payable is due to a related party. 5. Accrued payroll is understated. 6. One-third of the inventory of diamond jewelry is actually cubic zircona or white sapphires. 7. The client paid the same vendor invoice twice, although it is still shown as an account payable. 8. Client personnel informed the auditors that underground petroleum tanks contained an inventory of high-octane gasoline when they actually contained water. 9. The client failed to record warranty expenses incurred after year-end applicable to sales made before year-end. 10. Inventory in one corner of the warehouse is overlooked and not counted during the client's physical inventory count.
Listed below are several misstatements of inventory, accounts payable, and accrued liabilities accounts. Design a substantive audit procedure that provides reasonable assurance of detecting each misstatement. 1. A bonus earned by the president of the company has not been recorded. 2. Several accounts payable to vendors that
Controls for Inflows essay Proposal TOPIC: Design a proposal for appropriate controls to cover inventory, and production. With at least 2 references.
Accounting Questions on: 1) Inventory Valuation 2) FIFO, LIFO, Weighted-Average Question #1: Inventory Valuation Johnson's end inventory is 50 dual cassette decks that were purchased for $75 each. Johnson has been selling these units for $150 each. A new electronics store sells the same cassette decks for $130 each. J
Why wouldn't a small company derive much benefit from multi-echelon inventory optimization as a large company?
Why wouldn't a small company derive much benefit from multi-echelon inventory optimization as a large company? Explain your answer.
Identify the items that are included in merchandise inventory. (In your answer address the special situations of goods in transit, consigned goods, and damaged goods.)
14-3A - Assume that you must make a presentation to the marketing explaining the difference between product and period cost. Your supervisor tells you the marketing staff would also like clarification regarding prime and conversion costs and an explanation of how these terms fit with the product and period cost. You are told tha
At the beginning of the current season, the ledger of Village Tennis Shop showed Cash $2,500; Merchandise Inventory $1,700; and Common Stock $4,200. The following transactions were completed during April. Apr. 4 Purchased racquets and balls from Denton Co. $740, terms 3/10, n/30. 6 Paid freight on Denton Co. purchase $60. 8 Sold merchandise to members $900, terms n/30. 10 Received credit of $40 from Denton Co. for a damaged racquet that was returned. 11 Purchased tennis shoes from Newbee Sports for cash $300. 13 Paid Denton Co. in full. 14 Purchased tennis shirts and shorts from Venus's Sportswear $600, terms 2/10, n/60. 15 Received cash refund of $50 from Newbee Sports for damaged merchandise that was returned. 17 Paid freight on Venus's Sportswear purchase $30. 18 Sold merchandise to members $1,000, terms n/30. 20 Received $500 in cash from members in settlement of their accounts. 21 Paid Venus's Sportswear in full. 27 Granted an allowance of $30 to members for tennis clothing that did not fit properly. 30 Received cash payments on account from members $500. The chart of accounts for the tennis shop includes Cash; Accounts Receivable; Merchandise Inventory; Accounts Payable; Common Stock; Sales; Sales Returns and Allowances; Purchases; Purchase Returns and Allowances; Purchase Discounts; and Freight-in. Instructions (a) Journalize the April transactions using a periodic inventory system. (b) Using T accounts, enter the beginning balances in the ledger accounts and post the April transactions. (c) Prepare a trial balance on April 30, 2008. (d) Prepare an income statement through gross profit, assuming merchandise inventory on hand at April 30 is $2,296.
At the beginning of the current season, the ledger of Village Tennis Shop showed Cash $2,500; Merchandise Inventory $1,700; and Common Stock $4,200. The following transactions were completed during April. Apr. 4 Purchased racquets and balls from Denton Co. $740, terms 3/10, n/30. 6 Paid freight on Denton Co. purchase $60.
- How is inventory turnover calculated? - Explain how inventory turnover affects the amount of cash that must be invested in inventory. - How is accounts receivable turnover calculated? - Explain how accounts receivable turnover affects the amount of cash that must be invested in accounts receivable. - Assuming that
Gross profit and ending inventory A corporation produces a product with following costs as of July 1, 2011. Material $2 per unit Labor $4 per unit Overhead $2 per unit Beginning inventory at these costs on July 1st was 3,000 units. From July 1 to December 1, 2011 the corporation produced 12,000 units. These units had a ma
Garcia, Inc. uses a job-order costing system for its products, which pass from the Machining Department, to the Assembly Department, to finished-goods inventory. The Machining Department is heavily automated; in contrast, the Assembly Department performs a number of manual-assembly activities. The company applies manufacturing o
Goodson Corporation assembles various components used in the telecommunications industry. The company's major product, a relay switch, is the result of assembling three parts: XY634, AA788, and GU321. The following information relates to activities of April: Beginning work-in-process inventory: 4,000 units, 75 percent compl
See attached file for proper format of the table. P. 2 periodic inventory system and inventory costing methods The inventory of Product PIT and data on purchases and sales for a two-month period follow. The company closes its books at the end of each month. It uses the periodic inventory system. Apr. 1 Beginning inve
See attached file for proper format of tables. 1. For each of the following, indicate whether the transaction affects a revenue account, an expense account, the Retained Earnings account or the Common Stock account. 1. Made an investment to start the business. 2. Billed customers for services performed. 3. Paid monthly re
Donnelly Manufacturing sells cedar birdhouses. The company has prepared the following forecast for the third quarter of 2009: July 5,000 units August 6,000 units September 10,000 units Inventory at June 30, 2009 was budgeted at 1,000 units. Management would like the desired quantity of fi
P10-8 (Nonmonetary Exchanges) Susquehanna Corporation wishes to exchange a machine used in its operations. Susquehanna has received the following offers from other companies in the industry. 1. Choctaw Company offered to exchange a similar machine plus $23,000. (The exchange has commercial substance fo
All of the following are true with regard to both inventory and also with regard to property, plant, and equipment, except: 1. Both sets of assets are tangible. 2. For both sets of assets, cost is not reflected on the income statement until the asset is sold or otherwise disposed of. 3. Both sets of assets are generally presented on the financial statements at cost rather than at fair value. [Note that "fair value" is generally the price that the item can be sold for on the balance sheet date.] 4. Both sets of assets may be written down if the fair value is less than cost.
All of the following are true with regard to both inventory and also with regard to property, plant, and equipment, except: 1. Both sets of assets are tangible. 2. For both sets of assets, cost is not reflected on the income statement until the asset is sold or otherwise disposed of. 3. Both sets of assets are genera
The December 31, 2004 inventory of Dwyer Company consisted of four products, for which certain information is provided below. Product Original Replacement Estimated Expected Normal Cost Cost Disposal Selling Profit Cost Price on Sales A $35.00 $32.00 $6.50 $50.00 15% B $52.00 $51.00 $10.00 $60.00 25% C $140.00 $135.00 $25.00 $200.00 30% D $24.00 $21.00 $3.00 $35.00 20% INSTRUCTIONS: Using the lower of cost or market approach applied on an individual- item basis, compute the inventory valuation that should be reported for each product on December 31, 2004.
The December 31, 2004 inventory of Dwyer Company consisted of four products, for which certain information is provided below. Product Original Replacement Estimated Expected Normal Cost Cost Disposal Selling Profit
P7-10 (Comprehensive Receivables Problem) Connecticut Inc. had the following long-term receivable account balances at December 31, 2006. Note receivable from sale of division $1,800,000 Note receivable from officer 500,000 Transactions during 2007 and other information relating to Connecticut's long-term rec
An inventory taken the morning after a large theft discloses $55,000 of goods on hand as of March 12. The following additional data is available from the books: Inventory on hand, March 1 $84,000 Purchases received, March 1-11 $70,000 Sales (goods delivered to customers) $104