its books until at least ten days after month end. In this way, it can sort out ownership of goods in transit, and document which goods were received by month end, and which were not.
Q: Trial Balance to be correced Account Titles Cash in Bank Debit Credit 25,000 ccounts Receivable uppl...
A: Trial Balance: After posting the ledgers the balances of those accounts are posted in Trial balance....
Q: E. Assuming the company closets it's books on December 31, prepare the journal entres for 12/31/2019...
A: A journal entry is a form of accounting entry that is used to report a business transaction in a com...
Q: X Corp uses ABC to determine unit product cost. The company has two products namely G and N. The com...
A: Activity-based costing is used to distribute the overhead. in this overheads are allocated on the ba...
Q: on sells products for $43 each that have variab ual fixed cost is $638,000. ontribution margin appro...
A: Breakeven point is where the fixed cost equals the contribution margin . At breakeven point there is...
Q: On December 31, 2021, A&B Partnership has net income amounting to P350,450. Adjustments and correcti...
A: Adjustment to Net Income: Amount (P) Insurance expense account has a debit balance of P...
Q: Particulars Opening stock at 30,000 the branch Goods sent to Branch Sales made in Particulars Expens...
A: Branch accounting was an system of book keeping where an entity maintain its books separately in eac...
Q: Victoria Company sells bedsheets for P3,000 per set. There is a promotion wherein if a customer buys...
A:
Q: GOMEZ CORPORATION Comparative Income Statements For Years Ended December 31 Current Year Prior Year ...
A: All percentage are calculated with respect to sales.
Q: B. Retained Earnings Statement E Batance SheetMsimpte unelassified) Adjusted Trial Balance Debit Cre...
A: The income statement explains the financial performance of the company for a particular period of ti...
Q: Jordan Company incurs annual fixed costs of $51,415. Variable costs for Jordan's product are $30.15 ...
A: Lets understand the basics. Contribution margin is a margin earn by selling the goods. Contribution ...
Q: B1,B2,B3 are partners with average capital balances during 2021 of P945,000 P477 300 and P324,700, r...
A: The partnership comes into existence when two or more persons agree to do the business and further s...
Q: Mary is considering opening a hobby and craft store. Mary plans to operate the business for six year...
A: Net present value is the value of investment of the company in the present market. Whereas, cash flo...
Q: P21.3 (LO 2) Groupwork (Lessee Entries and Statement of Financial Position Presentation) Ludwick Ste...
A: Solution A journal is a company's official book in which all business transaction are recorded in ch...
Q: es Corporation manufactures two products: Product O95C and Product M31N. The company uses a plantwid...
A: Solution: Under Activity based costing system, difference activities overhead cost are applied to co...
Q: XYZ Entertainment Solutions Corporation manufactures and sells smart phones. Information on the prio...
A: Cost-volume-profit (CVP) analysis is a way to find out how changes in variable and fixed costs affec...
Q: Factory overhead, included P10 allowance for spoilage 180 Final inspection revealed that 600 bags w...
A: Cost of production(COP) refers to material, labours and overheads incurred during production.
Q: PA2. LO 6.1 Record journal entries for the following transactions of Barrera Suppliers. A. May 12: S...
A: The procedure of entering commercial transactions for the first time in the books of accounts is kno...
Q: Assume X Corp creates a subsidiary, Y Corp, and invests $500,000 cash in exchange for all of the $1 ...
A: GIVEN X Corp creates a subsidiary, Y Corp, and invests $500,000 cash in exchange for all of the $...
Q: When the book made a debit error in prior period and corrected in the current period:
A: Error is the wrong entry made by the company in recording the transactions in the respective ledgers...
Q: Specific employee earnings, withholdings, and pay detail to include hours worked, gross pay, net pay...
A: The employees are paid by the employer for the work done by him. Each payment made are recorded by t...
Q: In the current year, X Corp has the following items of income for tax purposes: gross profits from s...
A: Dividend received from 20% or more owned domestic then special deduction as per TCJA of 65% DRD is a...
Q: Oslo Company prepared the following contribution format income statement based on a sales volume of ...
A: The net income is calculated as difference between sales and total expenses incurred. The total expe...
Q: ntences are 4. How to Prevent Cheating (1) Teachers should take steps to prevent students from cheat...
A: Unity: All parts of the paragraph work together as a unit to express and support one main idea. Cohe...
Q: The following standard data are available for ABC Corp to produce one unit of product X: · ...
A: Material cost per unit = 3*5 = 15 Labor cost per unit = 2*10 = 20 Overhead rate per unit = (700,000/...
Q: A. Income ement B. Retained Earnings Statement E Batance SheeMsimpteunelassified) Adjusted Trial Bal...
A: Income statement is one of the financial statement which shows all incomes and all expenses and at t...
Q: Shore Company reports the following information regarding its production cost. 29,000 units %24 Unit...
A: Fixed Overhead per unit = Total Fixed overhead / Units produced Product Cost under absorption costin...
Q: Düring the months of January, Pearson Corporation sold goods to cus events was as follows: Date Tran...
A: Gross profit is one of the operational performance indicators. Higher the GP % better is the perform...
Q: The Warner Corporation has gross income of $560,000. It has business expenses of $325,000, a capital...
A: The portion of your total income that is used to calculate how much tax you owe in a given tax year ...
Q: Serena is a 38-year-old single taxpayer. She operates a small business on the side as a sole proprie...
A: The following condition needs to be satisfied by a self-employed person (Sarena) to claim the health...
Q: 10. The children's department has an opening inventory on May 1 of $48,500 at cost, with a markup of...
A: Markup on opening inventory= $ 48500*42%= $ 20370 markup on purchased merchandise= $ 38000*46% = $ 1...
Q: Pharoah Corporation issued 117,000 shares of $19 par value, cumulative, 7% preferred stock on Januar...
A: Lets understand the basics. When issue of preferred stock is made the journal entry is required to m...
Q: A. B and C are partners with average capital balances during 2020 of P945,000, P477,300 and P324,700...
A: Closing capital of partners is to be calculated as follows = Openin...
Q: Units started 100,000 20,000 14,500 97,000 Work in process, beginning (35% complete) Work in process...
A:
Q: What is Accou
A: Accounting: It is defined as a process of gathering, recording, summarizing, analyzing, and communic...
Q: Estimate the preliminary cost for the listed projects. You can use RSMeans Square Foot Costs data, a...
A: Preliminary cost is also known as rough cost or approximate estimate. This method is used to determi...
Q: Joint Products A, B and C are produced by JNT Corp. For the month just ended, these data are availab...
A: Average unit cost = Total Joint CostTotal No. of units produced Total joint cost = P49,830 Total no....
Q: profits and losses in the ratio of 20%, 30%, 50%, respectively. During the year, their partnership r...
A: The ending capital of partners is calculated after adjustments for additional investment, Drawings, ...
Q: A company manufactures two joint products at a joint cost of 1,000. These products can be sold at sp...
A: Introduction:- Joint cost means cost incurred but benefit obtained by more than one product. Which c...
Q: At the end of 2020, Payne Industries had a deferred tax asset account with a balance of $50 million ...
A: Solution 1: Payne Industries Journal Entries Event Particulars Debit (In Million) Credit (In ...
Q: Evaluate the ethical issues related to the payment of income taxes. in other words, if there is a le...
A: Tax saving is the option which the taxpayer uses in order to use the option and reduce the amount of...
Q: a. - On November 1, 2010, Chef Joe's Kitchen paid $2,325 in advance for 3 months of rent on its faci...
A: The adjustment entries are prepared to adjust the revenue and expenses of the current period. The a...
Q: A subsidiary of AEP places in service electric generating and transmission equipment at a cost of $3...
A: Present value is the concept that states an amount of money today is worth more than that same amoun...
Q: The stockholders' equity section of Heatherly Corporation's balance sheet as of December 31, 2021 is...
A: Shareholder's Equity Shareholders equity which is consist of both common stock and preference stock ...
Q: On May 10, Bramble Corp. issues 1,200 shares of $7 par value common stock for cash at $12 per share....
A: Introduction: Journals: Recording of a business transactions in a chronological order. First step in...
Q: Jillian Inc. manufactures and installs customized equipment. On January 1, 2021, Jillian entered int...
A: ANSWER IFRS 15 establishes the principles that an entity applies when reporting information abou...
Q: QUESTION 2 Don found a valuable jewel in the street. Unknown to Don, the jewel had jarred loose and ...
A: Question 2 b) Don would win against George, but lose if Kate challenged his title to the jewel ...
Q: On July 1, 2021, S Furniture, sold to B tables and chairs for a price of P500,000 for the latter's c...
A: S will not bear the loss because there is an exception to res perit domino rule
Q: The price of a commodity increased by 5% from 2014 to 2015, 8% irom 2015 to 2016 and 77% from 2016 t...
A: For the purpose of the average increase in the price of a commodity over a period of time, per year ...
Q: On January 1, 2022, A and B formed a partnership by contributing P200,000 and P180,000 respectively....
A: The question is related to Partnership Accounting. The details are given regarding capital introduce...
Q: income statement based on a sales volume of 1,000 units (the relevant range of production is 500 uni...
A: The operating leverage is calculated as contribution margin divided by EBIT.
Slater & Sons Corp manufactures electronic components for use in many consumer products. Their raw materials are purchased literally from all over the world. Depending on the country involved, purchase terms vary widely. Some suppliers, for example, require full prepayment, while others are content to receive payment within six months of receipt of the goods.
Because of this situation, Slater never closes its books until at least ten days after month end. In this way, it can sort out ownership of goods in transit, and document which goods were received by month end, and which were not.
Drew Bolton, a new accountant, was asked to record about $50,000 in inventory as having been received before month end. He argued that the shipping documents clearly showed that the goods were actually received on the 8th of the current month. His boss, busy with month-end reports, curtly tells Drew to check the shipping terms. He did so, and found the notation "FOB (free on board) shipper's dock" on the document. He hadn't seen that particular notation before, but he reasoned that if the selling company considered it shipped when it reached their dock, Slater should consider it received when it reached their dock. Drew did not record the sale until after month end.
Questions:
1. Why are accountants concerned with the timing in the recording of purchases?
2. Do you think that Drew made the correct decision? Why or why not?
3. Since the books are closed, as Drew's boss, how would you follow up with this situation?
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- Headland Company manufactures equipment. Headland's products range from simple automated machinery to complex systems containing numerous components. Unit selling prices range from $200,000 to $1,500,000 and are quoted inclusive of installation. The installation process does not involve changes to the features of the equipment and does not require proprietary information about the equipment in order for the installed equipment to perform to specifications. Headland has the following arrangement with Winkerbean Inc. Winkerbean purchases equipment from Headland for a price of $1,040,000 and contracts with Headland to install the equipment. Headland charges the same price for the equipment irrespective of whether it does the installation or not. The cost of the equipment is $620,000. Winkerbean is obligated to pay Headland the $1,040,000 upon the delivery and installation of the equipment. Headland delivers the equipment on June 1, 2020, and completes the installation of the equipment on…Crankshaft Company manufactures equipment. Crankshaft's products range from simple automated machinery to complex systems containing numerous components. Unit selling prices range from $200,000 to $1,500,000 and are quoted inclusive of installation. The installation process does not involve changes to the features of the equipment and does not require proprietary information about the equipment in order for the installed equipment to perform to specifications. Crankshaft has the following arrangement with Winkerbean Inc. Winkerbean purchases equipment from Crankshaft for a price of $1,000,000 and contracts with Crankshaft to install the equipment. Crankshaft charges the same price for the equipment irrespective of whether it does the installation or not. Using market data, Crankshaft determines installation service is estimated to have a standalone selling price of $50,000. The cost of the equipment is $600,000. Winkerbean is obligated to pay Crankshaft the $1,000,000 upon the delivery…Oriole Company manufactures equipment. Oriole's products range from simple automated machinery to complex systems containing numerous components. Unit selling prices range from $400,000 to $1,500,000 and are quoted inclusive of installation. The installation process does not involve changes to the features of the equipment and does not require proprietary information about the equipment in order for the installed equipment to perform to specifications. Oriole has the following arrangement with Henderson Inc. Henderson purchases equipment from Oriole for a price of $1,020,000 and contracts with Oriole to install the equipment. Oriole charges the same price for the equipment irrespective of whether it does the installation or not. The cost of the equipment is $643,00o. Henderson is obligated to pay Oriole the $1,020,000 upon the delivery and installation of the equipment. Oriole delivers the equipment on June 1, 2020, and completes the installation of the equipment on September 30, 2020.…
- Johanna Computer manufactures laptop computers under its own brand, but acquires all the components from outside vendors. No computers are assembled until the order is received online from customers, so there is no finished goods inventory. When an order is received, the bill of materials required to fill the order is prepared automatically and sent electronically to the various vendors. All components are received from vendors within three days and the completed order is shipped to the customer immediately when completed, usually on the same day the components are received from vendors. The number of units in process at the end of any day is negligible. The following data are provided for the most recent month of operations: Actual components costs incurred Actual conversion costs incurred Units in process, beginning of month Units started in process during the month Units in process, end of month $1,200,000 $1,850,000 -0- 4,000 -0- (a) Assuming Johanna uses traditional cost…Concord Company manufactures equipment. Concord’s products range from simple automated machinery to complex systems containing numerous components. Unit selling prices range from $200,000 to $1,500,000 and are quoted inclusive of installation. The installation process does not involve changes to the features of the equipment and does not require proprietary information about the equipment in order for the installed equipment to perform to specifications. Concord has the following arrangement with Winkerbean Inc. ● Winkerbean purchases equipment from Concord for a price of $960,000 and contracts with Concord to install the equipment. Concord charges the same price for the equipment irrespective of whether it does the installation or not. Using market data, Concord determines installation service is estimated to have a standalone selling price of $47,000. The cost of the equipment is $550,000. ● Winkerbean is obligated to pay Concord the $960,000 upon the delivery and…Riverbed Company manufactures equipment. Riverbed's products range from simple automated machinery to complex systems containing numerous components. Unit selling prices range from $ 200,000 to $ 1,500,000 and are quoted inclusive of installation. The installation process does not involve changes to the features of the equipment and does not require proprietary information about the equipment in order for the installed equipment to perform to specifications. Riverbed has the following arrangement with Winkerbean Inc. Winkerbean purchases equipment from Riverbed fora price of $ 1,100,000 and contracts with Riverbed to install the equipment. Riverbed charges the same price for the equipment irrespective of whether it does the installation or not. Using market data, Riverbed determines installation service is estimated to have a standalone selling price of $ 46,000. The cost of the equipment is $ 580,000. Winkerbean is obligated to pay Riverbed the $ 1,100,000 upon the delivery and…
- Concord Company manufactures equipment. Concord’s products range from simple automated machinery to complex systems containing numerous components. Unit selling prices range from $200,000 to $1,500,000 and are quoted inclusive of installation. The installation process does not involve changes to the features of the equipment and does not require proprietary information about the equipment in order for the installed equipment to perform to specifications. Concord has the following arrangement with Winkerbean Inc. ● Winkerbean purchases equipment from Concord for a price of $960,000 and contracts with Concord to install the equipment. Concord charges the same price for the equipment irrespective of whether it does the installation or not. Using market data, Concord determines installation service is estimated to have a standalone selling price of $47,000. The cost of the equipment is $550,000. ● Winkerbean is obligated to pay Concord the $960,000 upon the delivery and…Sweet Company manufactures equipment. Sweet’s products range from simple automated machinery to complex systems containing numerous components. Unit selling prices range from $200,000 to $1,500,000 and are quoted inclusive of installation. The installation process does not involve changes to the features of the equipment and does not require proprietary information about the equipment in order for the installed equipment to perform to specifications. Sweet has the following arrangement with Winkerbean Inc. ● Winkerbean purchases equipment from Sweet for a price of $930,000 and contracts with Sweet to install the equipment. Sweet charges the same price for the equipment irrespective of whether it does the installation or not. Using market data, Sweet determines installation service is estimated to have a standalone selling price of $46,000. The cost of the equipment is $560,000. ● Winkerbean is obligated to pay Sweet the $930,000 upon the delivery and installation of the…Wildhorse Company manufactures equipment. Wildhorse’s products range from simple automated machinery to complex systems containing numerous components. Unit selling prices range from $200,000 to $1,500,000 and are quoted inclusive of installation. The installation process does not involve changes to the features of the equipment and does not require proprietary information about the equipment in order for the installed equipment to perform to specifications. Wildhorse has the following arrangement with Winkerbean Inc. ● Winkerbean purchases equipment from Wildhorse for a price of $940,000 and contracts with Wildhorse to install the equipment. Wildhorse charges the same price for the equipment irrespective of whether it does the installation or not. Using market data, Wildhorse determines installation service is estimated to have a standalone selling price of $49,000. The cost of the equipment is $600,000. ● Winkerbean is obligated to pay Wildhorse the $940,000 upon the…
- Kingbird Company manufactures equipment. Kingbird’s products range from simple automated machinery to complex systems containing numerous components. Unit selling prices range from $400,000 to $1,500,000 and are quoted inclusive of installation. The installation process does not involve changes to the features of the equipment and does not require proprietary information about the equipment in order for the installed equipment to perform to specifications. Kingbird has the following arrangement with Henderson Inc. ● Henderson purchases equipment from Kingbird for a price of $1,090,000 and contracts with Kingbird to install the equipment. Kingbird charges the same price for the equipment irrespective of whether it does the installation or not. The cost of the equipment is $615,000. ● Henderson is obligated to pay Kingbird the $1,090,000 upon the delivery and installation of the equipment. Kingbird delivers the equipment on June 1, 2020, and completes the installation of…Culver Company manufactures equipment. Culver’s products range from simple automated machinery to complex systems containing numerous components. Unit selling prices range from $200,000 to $1,500,000 and are quoted inclusive of installation. The installation process does not involve changes to the features of the equipment and does not require proprietary information about the equipment in order for the installed equipment to perform to specifications. Culver has the following arrangement with Winkerbean Inc. ● Winkerbean purchases equipment from Culver for a price of $1,040,000 and contracts with Culver to install the equipment. Culver charges the same price for the equipment irrespective of whether it does the installation or not. The cost of the equipment is $581,000. ● Winkerbean is obligated to pay Culver the $1,040,000 upon the delivery and installation of the equipment. Culver delivers the equipment on June 1, 2020, and completes the installation of the equipment…QT, Inc., and Elppa Computers, Inc., compete with each other in the personal computer market. QT assembles computers to customer orders, building and delivering a computer within four days of a customer entering an order online. Elppa, on the other hand, builds computers for inventory prior to receiving an order. These computers are sold from inventory once an order is received. Selected financial information for both companies from recent financial statements follows (in millions): QT Elppa Sales $56,940 $120,357 Cost of merchandise sold 44,754 92,385 Inventory, beginning of period 1,382 6,317 Inventory, end of period 1,404 7,490 a. Determine for both companies (1) the inventory turnover and (2) the number of days' sales in inventory. Round your calculations and answers to one decimal place. Assume 365 days a year. QT Elppa 1. Inventory turnover fill in the blank 1 fill in the blank 2 2. Number of days' sales in inventory…
