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Accounting 4

1. Please select the right answer and explain in a few words why: In the buyer's records, the purchase of merchandise on account would: a. Increase assets and increase liabilities. b. Increase liabilities and increase paid-in capital. c. Increase assets and increase expenses. d. Have no effect on total assets. 2

Internal control weaknesses in inventory of raw materials

Pontex Co. produces a variety of chemical products for use by synthetics manufacturers.The plant operates on two shifts, five days per week, with routine maintenance work performed on the third shift and on Sundays, as required. Pontex's new internal audit department has recently completed a series of audits and the comments

Valuing Inventory: Prab Rrobots, Inc. Example

Please see the attached inventory information. (a) Why might Prab Robots, Inc., use two different methods for valuing inventory? (b) Comment on why Prab Robots, Inc., might disclose how its LIFO inventories would be valued under FIFO. (c) Why does the LIFO liquidation reduce operating costs? (d) Comment on whether Pr

Calculating Annual Cost of Dell Keyboard Inventory

Dell Company is selling the keyboard which sells direct to the customers. The average demand of keyboard is 8 per week The keyboard's cost is £20 each. The ordering cost is £50 per order. The holding cost is 20% per annum of the inventory value. The company works 52 weeks per year. Indeed, ABC Company orders 200 k

Inventory issues for Gleason, Murphy Supply, Sweet Creations

G) Gleason Corporation's fiscal year ends on December 31. Gleason determines inventory quantity by a physical count of inventory on hand at the close of business on December 31. The company's controller has asked for your help in deciding if the following items should be included in the year-end inventory count. 1. Goods pu

Lifo, Fifo, Lower cost or market, and depreciation.

21.The following information is available from the financial statements of Bluebird Enterprises for the years ended on December 31, 2004 and 2005: 2005 2004 Buildings $1,500,000 $2,250,000 Accumulated depreciation 550,000 660,000 Loss on sale of building in 2005 was $10,000. The book value of the building sold was $

Lower-of-cost-or-market, retail inventory method

1. Lower-of-cost-or-market. At 12/31/10, the end of Jenner Company's first year of business, inventory was $4,100 and $2,800 at cost and at market, respectively. Following is data relative to the 12/31/11 inventory of Jenner: Original Net Net Realizable Appropriate Cost Replacement Realizable Value Less Inventory

Inventory turnover and days sales in receivables

Computing inventory turnover and days sales in receivables: Low's companies income statement year ended January 31, 2011 Net sales 40.6 cost of goods sold 22.5 interest expenses 0.4 all other expenses 6.9 Net income 10.8

Economic ordering quanity, calculate orders, average inventory

Nowlin Pipe & Steel has projected sales of 72,000 pipes this year, an ordering cost of $6 per order, and carrying costs of $2.40 per pipe. a. What is the economic ordering quantity? b. How many orders will be placed during the year? c. What will the average inventory be?

FIFO and LIFO Periodic and Perpetual

Inventory information for Part 311 of Seminole Corp. discloses the following information for the month of June. June 1 Balance 300 units @ $10 June 10 Sold 200 units @ $24 11 Purchased 800 units @ $11 15 Sold 500 units @ $25 20 Purchased 500 units @

Lifo Fifo Weighted Average

A companys inventory records showed the following data relative to a particular item sold regularly ( assume that the transactions take place in the order given and inventory is valued using a periodic not perpetual system) Units Unit Cost 1

Gross Profit and Ending Inventory FIFO and LIFO

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

Ending Inventory using Gross Profit Method

Honda holds inventory all over the world. Assume that the records for an auto part shows the following: Beginning inventory - $150,000 Net purchases - 800,000 Net sales - 1,000,000 Gross profit rate - 40% Suppose this inventory, stored in the U.S., was lost in a fire. Estimate the amount of the loss to Honda. Use the gr

Cost of Goods sold, gross profit - Inventory

Compute cost of goods sold and gross profit under (a) FIFO (b) LIFO and (c) average cost (round average cost per unit to the nearest cent and al other amounts to the nearest dollar). Beginning Inventory - 20 tires @ $60 Purchase - 8 tires @ $75 Sale - 15 tires @ $110

A Small Lawn Mower Business: Ending Inventory & Cost of Sales

The following transactions were incurred concerning a small lawn mower business during April: April 1 Beginning Inventory 15 mowers @$110 per mower April 5 Purchased 20 mowers @ $115 per mower April 12 Sold 20 @ $160 per mower April 20 Purchased 10 mowers @ $120 per mower April 28 Sold 16 @ $160 per mower

Control Furniture Company: Effect of converting LIFO to FIFO

Control Furniture Company Annual Report Excerpts (Figures in thousands of dollars) December 31 2015 2016 Inventories at FIFO Cost 846.3 852.6 Excess of FIFO Cost over LIFO Cost (231.4) (257.2) Inventories at LIFO Cost 614.9 595.4 Given the financial information presen

This case study is about a furniture company owner that needs to encourage sales of current inventory as well as obtain an increase in its line of credit in order to replenish and expand the furniture stock.

Franklyn Furniture (FF) is a midsized owner operated business that was started 25 years ago by Fred Franklyn. The retail furniture business is cyclical, with business dropping off in times of economic downturn, as is the case currently. In order to encourage sales, the store offers its own credit cards to good customers. FF has

(FIFO and LIFO Effects)

Problem attached in best format. You are the vice-president of finance of Mickiewicz Corporation, a retail company that prepared two different schedules of gross margin for the first quarter ended March 31, 2010. These schedules appear below. Sales ($5 per unit) Cost of Goods Sold Gross Margin Schedule 1 $154,600

Influence Tactics Inventory: Factors, Patterns

See the attached data file. Instruction: Review the class results for the influence tactics Inventory. Compare the influence tactics your fellow learners used with superiors, subordinates, and co-workers. 1. How do the tactics vary in how frequently they are used and why does this pattern occur? 2. Which influenc

Gotham Company: Calculate the correct balance for ending inventory

Gotham Company reported a December 31 ending inventory balance of $412,000. The following additional information is also available: The ending inventory balance of $412,000 included $72,000 of consigned inventory for which Gotham was the consignor. The ending inventory balance of $412,000 included $22,000 of office suppl

Calculating the Total Value of a Company's Ending Inventory

A company has the following per unit original costs and replacement costs for its inventory: Part A: 50 units with a cost of $5, and replacement cost of $4.50 Part B: 75 units with a cost of $6, and replacement cost of $6.50 Part C: 160 units with a cost of $3, and replacement cost of $2.50 Under the lower of cost or marke

Case - Which method shall we use? LIFO FIFO

The White Wove Corporation began operations in 2011. A summary of the firs quarter appears below: Purchases: January 2...............250 units...............$23,250 February 11............100 units...............$9,500 February 20.............400 units.........$38,400 March 21................200 units..............

Manufacturing Company: Reconstruct inventory values after flood

A flood recently destroyed many of the financial records of Yak Manufacturing Company. Management has hired you to re-create as much financial information as possible for the month of July. You are able to find out that the company uses an average cost inventory valuation system. You also learn that Yak makes a physical cout

T-account cost flow diagram: Inventory and cost of goods sold

In the T-account cost flow diagram of balance sheet inventory accounts and the income statement cost of goods sold account: a. cost of goods sold is debited to finished goods inventory. b. cost of goods manufactured is debited to finished goods inventory. c. direct labor costs are credited to work in process. d

Management Accounting: Selling at the Split Off Point or Not

Jerrings Company has already manufactured 28,000 units of Products A at a cost of $28 per unit. The 28,000 units can be sold at this stage for $700,000. Alternatively, it can be further processed at a $420,000 total additional cost and be converted into 5,600 units of Product B and 11,200 units of Product C. Per unit selling