1. The Kulbaan Company has a PL500,000 oustanding note payable to Kabado Corporation. Because of the financial difficulties, Kulbaan negotiates with Kabado to exchange inventory to satisfy the debt. The cost of the inventory transferred is carried on Kulbaan's books at P900,000. The estimated retail value of the inventory is P1,400,000. Kulbaan uses a perpetual inventory system. What is the total amount of gain on restructuring and disposal of asset to be reported in Kulbaan's profit or loss?

1. The Kulbaan Company has a PL500,000 oustanding note payable to Kabado Corporation. Because of the financial difficulties, Kulbaan negotiates with Kabado to exchange inventory to satisfy the debt. The cost of the inventory transferred is carried on Kulbaan's books at P900,000. The estimated retail value of the inventory is P1,400,000. Kulbaan uses a perpetual inventory system. What is the total amount of gain on restructuring and disposal of asset to be reported in Kulbaan's profit or loss?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Tannin Products Inc. prepared the following factory overhead cost budget for the Trim Department for July of the current year, during which it expected to use 14,000 hours for production: Variable overhead cost: Indirect factory labor $44,800 Power and light 10,360 Indirect materials 21,000 Total variable overhead cost $ 76,160 Fixed overhead cost: Supervisory salaries $54,380 Depreciation of plant and equipment 14,310 Insurance and property taxes 26,710 Total fixed overhead cost 95,400 Total factory overhead cost $171,560 Tannin has available 18,000 hours of monthly productive capacity in the Trim Department under normal business conditions. During July, the Trim Department actually used 13,000 hours for production. The actual fixed costs were as budgeted. The actual variable overhead for July was as follows: Actual variable factory overhead cost: Indirect factory labor $40,560…
Stuff Company is a subsidiary of Pland Corporation and is located in Madrid, Spain, where the currency is the euro (€). Data on Stuff’s inventory and purchases are as follows: Inventory, January 1, 20X7 € 230,000 Purchases during 20X7 858,000 Inventory, December 31, 20X7 183,000 The beginning inventory was acquired during the fourth quarter of 20X6, and the ending inventory was acquired during the fourth quarter of 20X7. Purchases were made evenly over the year. Exchange rates were as follows: Fourth quarter of 20X6 € 1 = $ 1.29015 January 1, 20X7 € 1 = $ 1.32030 Average during 20X7 € 1 = $ 1.39655 Fourth quarter of 20X7 € 1 = $ 1.45000 December 31, 20X7 € 1 = $ 1.47280 Required: Show the remeasurement of cost of goods sold for 20X7, assuming that the U.S. dollar is the functional currency. Note: Round your intermediate calculations and final answer to nearest dollar amount. Show the translation of cost of goods sold for 20X7, assuming that the euro is the…
32.ABC Store purchased P100,000 from XYZ Supplies on July 1, 20X1. Terms: 5%, 3%, 2/15, n/30. FOB Shipping point, freight prepaid. Shipping costs was P2,000. Insurance for the shipment was P500 and non refundable tax was P1,000. At what amount should ABC recognize as cost of the inventory under the gross method? 91,807 93,807 93,650 95,650
Mahan Company purchased inventory on account under terms 2/10, n/30. Mahan would like to pay the account payable within the discount period in order to receive the discount. Unfortunately, Mahan does not have the cash. What is the maximum annual interest rate that Mahan would be willing to pay in order to borrow the money necessary to settle the account payable?
Ankaran Enterprises currently has $800 in cash, and total assets of $20,400. The company owes $1,400 to suppliers for merchandise and $5, 100 to the bank for a long-term loan. Customers owe Ankaran's $1,100. The inventory has a book value of $4, 400 and an estimated market value of $5,500. If Ankaran's compiled a financial statement today, how much would it show as the value of the current assets?
Flingen Inc. reveals the following information in their annual report for FY 2021 Selected Income Statement Items: Sales $10,500,000 Cost of goods sold $5,500,000 Pretax earnings $650,000 Selected Balance Sheet Items: Merchandise inventory $800,000 Total assets $2,500,000 Upper management plans to cut cost of goods sold by 4.5% for the coming year but retain the same sales and weeks of inventory. What is the return on assets estimated to be for 2022? Group of answer choices 33.7% 32.1% 36.8% 34.1%
The following transactions occured during 2014 for Bentley Inc. which uses a perpetual inventory system: (a) June 1: Bentley Inc.'s merchandise was sold to Zcom Inc. for $9,900 under credit terms of 2/30, n/60, FOB shipping point. The cost of the merchandise was $7,920. (b) June 1: Bentley Inc. purchased merchandise from Barton Corporation for $5,200 under credit terms of n/60, FOB shipping point. (c) June 2: Bentley Inc. purchased merchandise from Southgate Inc. for $6,500 cash, FOB destination. (d) June 2: Bentley Inc. purchased merchandise from Allarco Inc. for $9,700 under credit terms of n/60, FOB destination. (e) June 2: Paid $300 for freight charges for the June 1 purchase of merchandise. (f) June 4: Bentley Inc. sold merchandise that cost $7,600 to Star Inc. for $9,500 under credit terms of 2/30, n/60, FOB shipping point. (g) June 11: Zcom Inc. requested a price reduction on the June 1 sale because the merchandise did not meet specifications. Sent Zcom Inc. a credit memorandum…
Metlock's Market recorded the following events involving a recent purchase of inventory: Received goods for $78200, terms 2/9, n/30. Returned $1700 of the shipment for credit. Paid $700 freight on the shipment. Paid the invoice within the discount period. As a result of these events, the company's inventory increased by $74970. increased by $75670. increased by $77200. O increased by $75656. O O
Jordache Corp. uses a perpetual inventory system and sells merchandise on account to Polo Limited for $2.000 on February 2, terms n/10. Management expects returns of 10%. The goods cost Jordache $800. On February 5, Polo returns merchandise worth $500 to Jordache. This merchandise costs $300 and is still in saleable condition; therefore, it was put back into inventory. On February 9, Jordache receives payment from Polo for the balance due. Identify the journal entry that Jordache needs to record for the sale of the merchandise on February 2. Accounts Receivable Sales Refund Liability Cash Accounts Receivable Accounts Receivable Sales Accounts Receivable Sales 2,000 1,800 1.800 2,000 1,800 200 1,800 1,800 2,000
Cumberland Co. sells $919 of inventory to Hancock Co. for cash. Cumberland paid $673 for the merchandise. Under a perpetual inventory system, which of the following journal entry(ies) would be recorded?
15 )
Steria corporation buys merchandise on account from Pinacle corporation. Selling price of the goods = $1,140 Cost of the goods =$830 Both of the corporations used perpetual inventory systems. Journalize the transaction on the books of both companies. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)