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FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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
Transcribed Image Text:Seemore Lens Company (SLC) sells contact lenses FOB destination. For the year ended December 31, the company reported Inventory
of $70,000 and Cost of Goods Sold of $420,000.
a. Included in Inventory (and Accounts Payable) are $10,000 of lenses SLC is holding on consignment.
b. Included in SLC's Inventory balance are $5,000 of office supplies held in SLC's warehouse.
c. Excluded from SLC's Inventory balance are $8,000 of lenses in the warehouse, ready to send to customers on January 2. SLC
reported these lenses as sold on December 31, at a price of $15,000.
d. Included in SLC's Inventory balance are $3,000 of lenses that were damaged in December and will be scrapped in January, with
zero realizable value.
Required:
Prepare the table showing the balances presently reported for Inventory and Cost of Goods Sold, and then displaying the
adjustment(s) needed to correctly account for each of items (a)-(d), and finally determining the appropriate Inventory and Cost of
Goods Sold balances. (Enter any decreases to account balances with a minus sign.)
Present Balance
a.
b.
C.
d.
Appropriate Balance
Inventory
$
Cost of Goods Sold
0 $
0
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