For each of the situations, identify (a) the characteristic, constraint, or measurement basis involved, and (b) whether the company has followed or violated the assumption, constraint, or measurement basis.
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For each of the situations, identify (a) the characteristic, constraint, or measurement basis involved, and (b) whether the company has followed or violated the assumption, constraint, or measurement basis.
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- The owner of a large machine shop has just i nished its i nancial analysis from the prior fiscal year. Following is an excerpt from the i nal report:a. Compute the inventory turnover ratio (ITR).b. Compute the weeks of supply (WS).Cost of Goods Sold and Income Statement Schuch Company presents you with the following account balances taken from its December 31 adjusted trial balance: Additional data: 1. A physical count reveals an ending-inventory of 22,500 on December 31. 2. Twenty-five thousand shares of common stock have been outstanding the entire year. 3. The income tax rate is 30% on all items of income. Required: 1. As a supporting document for Requirements 2 and 3, prepare a separate schedule for Schuchs cost of goods sold. 2. Prepare a multiple-step income statement. 3. Prepare a single-step income statement.The moving average inventory cost flow assumption is applicable to which of the following inventory systems? Questions M7-6 and M7-7 are based on the following data: City Stationers Inc. had 200 calculators on hand on January 1, 2019, costing 18 each. Purchases and sales of calculators during the month of January were as follows: City uses a periodic inventory system. According to a physical count, 150 calculators were on hand at January 31, 2019.
- The following accounts appear in the ledger of Celso and Company as of June 30, the end of this fiscal year. The data needed for the adjustments on June 30 are as follows: ab.Merchandise inventory, June 30, 54,600. c.Insurance expired for the year, 475. d.Depreciation for the year, 4,380. e.Accrued wages on June 30, 1,492. f.Supplies on hand at the end of the year, 100. Required 1. Prepare a work sheet for the fiscal year ended June 30. Ignore this step if using CLGL. 2. Prepare an income statement. 3. Prepare a statement of owners equity. No additional investments were made during the year. 4. Prepare a balance sheet. 5. Journalize the adjusting entries. 6. Journalize the closing entries. 7. Journalize the reversing entry as of July 1, for the wages that were accrued in the June adjusting entry. Check Figure Net income, 14,066Prepare an income statement and a statement of financial position in accordance with current cost accounting. Problern 23-12 (IAA) Legaspi Company was formed on January 1, 2020. The entity venorted the following financial statements pertaining to the first year of operations: Sales Cost of goods sold: Inventory- January 1 Purchases 5,000,000 1,000,000 3,100,000 Goods available for sale Inventory -December 31 4,100,000 ( 900,000) 3,200,000 Gross income Operating expenses: Expenses Depreciation 1,800,000 700,000 100,000 800,000 Income before income tax Less: Income tax 1,000,000 350,000 Net income 650,000 Assets Сash Accounts receivable Inventory Land Equipment (10-year life) Accumulated depreciation 500,000 600,000 900,000 800,000 1,000,000 ( 100,000) Total assets 3,700,000 Liabilities and Shareholders' Equity Accounts payable Notes payable Income tax payable Share capital Retained earnings: Net income Dividėnds 500,000 400,000 350,000 2,000,000 650,000 ( 200,000) 450,000 Total…I What is the amount of gross profit for the eleven months 2 What is the amount of sales for the month of June? a What is the cost of goods sold for the month of June ? at an interim date, May 31, 2020, instead of at year end. ended June 30, 2020, the CPA observed the physical inventory The following information was obtained from the general „Problem 13-14 (AICPA Adapted) ended May 31, 2020? year In conducting an audit of Ultimate Company for the a 1,680,000 b. 1,725,000 C. 1,735,000 d. 1,670,000 ledger. Inventory, July 1, 2019 Physical inventory, May 31, 2020 Sales for 11 months ended May 31, 2020 Sales for year ended June 30, 2020 Purchases for 11 months ended May 31, 2020 before audit adjustments Purchases for year ended June 30, 2020 before audit adjustments 875,000 950,000 8,400,000 9,600,000 в. 1,100,000 b. 1,200,000 c. 1,300,000 d. 1,400,000 er 14 6,750,000 8,000,000 1. Shipments received in May and included in the physical inventory but recorded as June purchases a. 960,000 b.…
- Assuming a company’s year-end inventory were overstated by $5,000, indicate the effect(overstated/understated/no effect) of the error on the following balance sheet and income statement accounts.A. Income Statement: Cost of Goods SoldB. Income Statement: Net IncomeC. Balance Sheet: AssetsD. Balance Sheet: LiabilitiesE. Balance Sheet: EquityDEF’s branch submitted the following data for the current year (its first year of operation): Sales of P203,500, Debit balance for Shipment from home office of P186,120, Operating Expenses of P18,755 and a credit balance for Home Office account of P48,125. Shipment to the branch are billed at cost. The ending inventory of the branch was P25,245. Compute for the correct balance of Branch Account- to be presented in the home office books?Subject: accounting In the first year of a company's operations, it uses FIFO for internal record keeping but LIFO for reporting ending inventory. Ending inventory under FIFO is $90,000, and ending inventory under LIFO is $80,000. The company's year-end LIFO adjusting entry will have what effect on the financial statements?
- Granger Supply, Inc., has two main areas of inventory, industrial supplies and industrial cleaning equipment. The FIFO inventory method is used for industrial supplies, and the LIFO method is used for the cleaning equipment. Prior to considering special interim reporting modifications for LIFO liquidations and lower of cost or market, the company reported the following results for the first two quarters of the current year: Quarter 1 Quarter 2Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,000,000 $9,000,000Cost of sales—industrial supplies . . . . . . . . . 4,300,000 4,700,000Cost of sales—cleaning equipment . . . . . .. . 3,000,000 3,200,000Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,700,000 $1,100,000Selling, general, and administrative . . . . . . . 2,100,000 1,800,000Income before taxes . . . . . . . . . . . . . . . . . .…Sanchez Company was formed on January 1 of the current year and is preparing the annual financial statements dated December 31, current year. Ending inventory information about the four major items stocked for regular sale follows: Item ABUD A ENDING INVENTORY, CURRENT YEAR Quantity Unit Cost When on Hand Acquired (FIF0) Required: 1. Compute the valuation that should be used for the current year ending inventory using lower of cost or net realizable value applied on an item-by-item basis. 2. What will be the effect of the write-down of inventory to lower of cost or net realizable value on cost of goods sold for the year ended December 31, current year? Complete this question by entering your answers in the tabs below. Total Net tem Quantity Total Cost Realizable Value D Required 1 Required 2 Compute the valuation that should be used for the current year ending inventory using lower of cost or net realizable value applied on an item-by-item basis. C D 31 31 66 46 21 $16 45 56 33 66 DE $…Prepare the journal entry to record the LIFO adjustment. See the information below: The balances in Inventory – Finished Goods for the first and second year that WTG was in business were $275,000 and $350,000, respectively. The relevant indices for the 4 years are as follows: Year 1: 100 Year 2: 101 Year 3: 102 Year 4 (Current Year): 103 The computation of LIFO is included in the “Inventory” spreadsheet attached.
