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Purchases, Inventory and Cost of Goods Sold (COGS)

Inventory Turnover for Donovan Enterprises

Donovan Enterprises us trying to determine the effect of its inventory turnover ratio and DSO on its cash flow cycle. Donovan's sales last year (all on credit) were $185,000, and it earned a profit of 7.5%. It turned over its inventory 8 times during the year, and its DSO was 43. Donovan's COGS was $123,500. The firm had fixed a

Identify the assertions for audit of client's inventory

5-29 (Assertions) In planning the audit of a client's inventory, an auditor identified the following issues that need audit attention. 1. Inventories are properly stated at the lower of cost or market. 2. Inventories included in the balance sheet are present in the warehouse on the balance sheet date. 3. Inventory quantitie

Transaction cycle chart

I need help with completing a transaction cycle chart for the accounting for inventory portion only. I completed the other three sections. Attached is the scenario and a final blank chart template for completion of accounting for inventory.

Marie's revenue recognition; Inventory Turnover for Walmart and Target

Question 4: Problem 4-8A (pages 203-204 in the text) Marie's Catering makes sandwiches for vending machines. The sandwiches are delivered to the vendor on the same day that they are made. The following events took place during the first year of operations: A. On the first day of the year, issued common stock for $20,000 ca

Activity-based costs, inventory account, manufacturing overhead

Choose the correct answer: 5. The shift in the amount of manufacturing overhead costs applied to the mix of products produced that occurs when using a single cost driver rate as compared to using activity-based costing rates is known as: a. cost absorption b. underapplied overhead c. overapplied overhead d. cost distor

Consider four cases of variation in the model parameters - Hayes Electronics

I need assistance in how to solve the below problem. Hayes Electronics assumes with certainty that the ordering cost is $450 per order and the inventory carrying cost is $170 per unit per year. However, the inventory model parameters are frequently only estimates that are subject to some degree of uncertainty. Consider

ABC Analysis Tutorial

Please help with the given problem: How does ABC Analysis divide the total inventory using the rupee volume? Explain.

Cost Valuation Systems: Inventory and Costs of Goods Sold

Please help to analyze the questions. In addition I need the formula to for the FIFO method and LIFO along with the cost of good sold. See the attached file. 1. The Beautifully Fabulous Beauty Salon (BFBS) purchases its inventory from a manufacturer in California. BFBS has a high selling product called "Beauty Gloss". D

Schedule of Cost of Goods Manufactured COGS income statement

Please review my 1st attempt of preparing a schedule of cost of good based upon provided information. I am not sure of if my selections for the various costings are correct, .i.e. Advertising cost, Salaries and depreciation. Are these types of costs considered indirect manufacturing overhead? Please review cost selection

Turk's Toy Trains: Calculate Ending Inventory

Turk's Toy Trains began 2008 with 1200 toy trains, which cost $9.00 each in its inventory. During the year it made the following inventory purchase of inventory. Date Units Purchased Cost per Unit Total Cost 3/18 500 $9.50 $4,750 6/4 700 $10.00 $7,000 8/28 400 $10.50 $4,200 11/13 900 $11.50 $10,350 Total 2500 - $26,300

Kreiter Instrument: Change in inventory accounting method to average cost

See attached file for clarity. The management of Kreiter Instrument Company had concluded, with the concurrence of its independent auditors, that results of operations would be more fairly presented if Kreiter changed its method of pricing inventory from last-in, first-out (LIFO) to average cost in 2007. Given below is t

Key Reasons Organizations Hold Inventories

Identify key reasons that organizations may need to hold inventories. What factors may lead an organization to change the level of inventories that it holds? How could such a decision affect the other elements of working capital?

Specific Identification inventory method

Specific Identification inventory method Date Activities Units Acquired at Cost Units sold at Retail Jan. 1 Beg. Inventory 60 units @ $10=$600 Jan. 10 Sales 61 units @ $40 Mar. 14 Purchase 173 units

Important information about AFN equation

Carter Corporation's sales are expected to increase from $5 million in 2008 to $6 million in 2009, or by 20%. Its assets totaled $3 million at the end of 2008. Carter is at full capacity, so its assets must grow in proportion to projected sales. At the end of 2008, current liabilities are $1 million, consisting of $250,000 of ac

Carter Corporation: Use the AFN equation to forecast the additional funds needed.

Carter Corporation's sales are expected to increase from $5 million in 2008 to $6 million in 2009, or by 20%. Its assets totaled $3 million at the end of 2008. Carter is at full capacity, so its assets must grow in proportion to projected sales. At the end of 2008, current liabilities are $1 million, consisting of $250,000 of

Perpetual inventory

April 2. Purchased merchandise on account from Dakota Supply Co. $6,900, terms 1/10, n/30. April 4. Sold Merchandise on account $5,500. FOB Destination, terms, 1/10, n/30. The cost of the merchandise sold was $4,1000

Accounting MCQ: inventory, equipment cost, R&D, liabilities. gross profit method

Gomez Company had a gross profit of $360,000, total purchases of $420,000, and an ending inventory of $240,000 in its first year of operations as a retailer. Gomez's sales in its first year must have been a. $540,000. b. $660,000. c. $180,000. d. $600,000. Tyson Chandler Company purchased equipment for $10,000. Sales tax

Oxidizing and Reducing Limits for Water

Flannery Furnishings has $150,000 in sales. The company expects that its sales will increase 30% this year. Flannery's CFO uses a simple linear regression to forecast the company's inventory level for a given level of projected sales. On the basis of recent history, the estimated relationship between inventories and sales (in th

Computer-Assisted Substantive Tests for Inventory Audit

Just need some assistance getting my mind wrapped around this problem... 16-29 (Computer-assisted substantive tests for inventory) An auditor is conducting an audit of the financial statements of a wholesale cosmetics distributor with an inventory consisting of thousands of individual items. The distributor keeps its inventor

Computer-Assisted Substantive Tests for Inventory

An auditor is conducting an audit of the financial statements of a wholesale cosmetics distributor with an inventory consisting of thousands of individual items. The distributor keeps its inventory in its own distribution center and two public warehouses. An inventory computer file is maintained on a computer disk and at the end

Cost of debt using the approximation formula

For each of the $1000 par-value bonds in the attached file, assuming annual interest payment and a 40% taxe rate, calculate the after-tax cost to maturity using the approximation formula.

Inventory problem: Basic EOQ model

Tele-Reco is a new specialty store that sells television sets, videotape recorders, video games, and other television-related products. A new Japanese-manufactured videotape recorder costs Tele-Reco $600 per unit. Tele-Reco's annual holding cost rate is 22%. Ordering costs are estimated to be $70 per order. a. If demand for t

Inventory Policy

Suppose that R&B Beverage Company has a soft drink product that shows a constant annual demand rate of 3600 cases. A case of the soft drink costs R&B $3. Ordering costs are $20 per order and holding costs are 25% of the value of the inventory. R&B has 250 working days per year, and the lead time is 5 days. Identify the following