The home office ships merchandise to the branch at 50 percent above cost. On its books the branch shows a beginning inventory of home office merchandise amounting to 15,000 and shipments from home office of 110,000. Its ending inventory of home office merchandise is 5,000. What amount should the home office adjust the allowance for overvaluation of branch inventory account.

The home office ships merchandise to the branch at 50 percent above cost. On its books the branch shows a beginning inventory of home office merchandise amounting to 15,000 and shipments from home office of 110,000. Its ending inventory of home office merchandise is 5,000. What amount should the home office adjust the allowance for overvaluation of branch inventory account.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter7: Inventories: Cost Measurement And Flow Assumptions

Section: Chapter Questions

Problem 5MC: The moving average inventory cost flow assumption is applicable to which of the following inventory...

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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.
tfom 21. The home office ships merchandise to the branch at 50% above cost. On its books the branch shows a beginning inventory of home office merchandise amounting to 15,000 and shipments from home office of 110,000. Its ending inventory of home office merchandise is 5,000. What amount should the home office adjust the allowance for overvaluation of branch inventory account?
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