Financial Accounting: Tools for Business Decision Making, 8th Edition
8th Edition
ISBN: 9781118953808
Author: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso
Publisher: WILEY
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Question
Chapter 6, Problem 6.2EYCT
(a) (1)
To determine
Annual Report is a comprehensive financial report that shows all the business activities, that takes place throughout the previous financial year. Its purpose is to provide the complete information of a company’s financial activities, to its users in order to help them analyze, and take well informed decisions.
To Compute: The inventory turnover of Company CS, and Company VF for 2014.
(2)
To determine
To Compute: The days in inventory of Company CS, and Company VF for 2014.
(b)
To determine
To Describe: The conclusions concerning the management of the inventory can be drawn from the above data.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Cruz Company uses LIFO for inventory costing and reports the following financial data. It also recomputed inventory and cost of
sold using FIFO for comparison purposes.
LIFO inventory
LIFO cost of goods sold
FIFO inventory
FIFO cost of goods sold
Current assets (using LIFO)
Current assets (using FIFO)
Current liabilities
1. Compute its current ratio, inventory turnover, and days' sales in inventory for Year 2 using (a) LIFO numbers and (b) FIFO number
Current ratio
Inventory turnover
Days' sales in inventory
Answer is not complete.
(a) Compute its current ratio, inventory turnover, and days' sales in inventory for Year 2 using LIFO
numbers.
Current ratio
Inventory turnover
Days' sales in inventory
Current ratio
Inventory turnover
Days' sales in inventory
$
$
$
$
Year 2
$ 290
870
360
825
350
420
170
Numerator 1 Denominator
350.0 / $
$
870.0
111.0 X
$
$
$
Numerator 1
350.0 /
(a) Compute its current ratio, inventory turnover, and days' sales in inventory for Year 2 using LIFO
numbers.…
[The following information applies to the questions displayed below.]
A company reports inventory using the lower of cost and net realizable value (NRV). Below is information related to its year-end inventory.
Inventory
Quantity
Unit Cost
Unit NRV
Furniture
170
$
82
$
97
Electronics
47
370
285
Record the adjustment for inventory.
Note: Enter debits before credits.
Transaction
General Journal
Debit
Credit
1
Cost of Goods Sold
Inventory
You are examining the financial statements of France Company for the year ended
December 31, 2022. It uses the physical inventory system of accounting for inventory.
During your examination, you discovered that the goods received in December, 2022
at a cost of P 50,000 were recorded as purchases when paid in 2023. The goods were
excluded from the 2022 ending inventory.
Based on the foregoing, answer the following questions:
Question 1: Which of the following accounts is(are) understated by P 50,000 at th
end of year 2022 as a result of the error?
, is(are) understated by P 50,000 at the
| Select ]
Select
a. Purchases only
b. Purchases and Inventory, December 31, 2022
c. Retained Earnings only
d. Inventory , December 31. 2022 only
Question 2: Which of the following accounts is(are) not affected by the error at the
end of year 2022?
[ Select]
of the following accounts is(are)
[ Select]
a. Accounts Payable
b. Retained Earnings
c. Inventory, December 31, 2022
d. Purchases
Question 3: Which…
Chapter 6 Solutions
Financial Accounting: Tools for Business Decision Making, 8th Edition
Ch. 6 - The key to successful business operations is...Ch. 6 - Prob. 2QCh. 6 - What is just-in-time inventory management? What...Ch. 6 - Prob. 4QCh. 6 - Prob. 5QCh. 6 - Prob. 6QCh. 6 - Prob. 7QCh. 6 - Prob. 8QCh. 6 - What is the major advantage and major disadvantage...Ch. 6 - The selection of an inventory cost flow method is...
Ch. 6 - Which assumed inventory cost flow method: (a)...Ch. 6 - Prob. 12QCh. 6 - Prob. 13QCh. 6 - Prob. 14QCh. 6 - Prob. 15QCh. 6 - Prob. 16QCh. 6 - Prob. 17QCh. 6 - Prob. 18QCh. 6 - Why is it inappropriate for a company to include...Ch. 6 - Prob. 20QCh. 6 - Prob. 21QCh. 6 - Prob. 22QCh. 6 - When perpetual inventory records are kept, the...Ch. 6 - How does the average-cost method of inventory...Ch. 6 - Prob. 25QCh. 6 - Prob. 6.1BECh. 6 - Prob. 6.2BECh. 6 - Prob. 6.3BECh. 6 - Prob. 6.4BECh. 6 - Prob. 6.5BECh. 6 - Prob. 6.6BECh. 6 - Prob. 6.7BECh. 6 - Prob. 6.8BECh. 6 - Prob. 6.9BECh. 6 - Prob. 6.10BECh. 6 - Prob. 6.11BECh. 6 - Prob. 6.1DIECh. 6 - Prob. 6.2DIECh. 6 - Prob. 6.3ADIECh. 6 - Prob. 6.3BDIECh. 6 - Prob. 6.1ECh. 6 - Prob. 6.2ECh. 6 - Prob. 6.3ECh. 6 - Prob. 6.4ECh. 6 - Prob. 6.5ECh. 6 - Prob. 6.6ECh. 6 - Prob. 6.7ECh. 6 - Prob. 6.8ECh. 6 - Prob. 6.9ECh. 6 - Prob. 6.10ECh. 6 - Prob. 6.11ECh. 6 - Prob. 6.12ECh. 6 - Prob. 6.13ECh. 6 - Inventory data for Jeters Company are presented in...Ch. 6 - Prob. 6.15ECh. 6 - Prob. 6.16ECh. 6 - Prob. 6.17ECh. 6 - Prob. 6.1APCh. 6 - Prob. 6.2APCh. 6 - Prob. 6.3APCh. 6 - Prob. 6.4APCh. 6 - Prob. 6.5APCh. 6 - Prob. 6.6APCh. 6 - Prob. 6.7APCh. 6 - Prob. 6.8APCh. 6 - Prob. 6.9APCh. 6 - Prob. 6.1CACRCh. 6 - Prob. 6.1EYCTCh. 6 - Prob. 6.2EYCTCh. 6 - Prob. 6.3EYCTCh. 6 - Prob. 6.4EYCTCh. 6 - The July 15, 2010, edition of CFO.com contains an...Ch. 6 - Prob. 6.7EYCTCh. 6 - Prob. 6.8EYCTCh. 6 - Prob. 6.9EYCTCh. 6 - Prob. 6.10EYCTCh. 6 - Prob. 6.11EYCTCh. 6 - Prob. 6.1IFRSCh. 6 - Prob. 6.2IFRSCh. 6 - Prob. 6.3IFRS
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Use a spreadsheet and the following excerpts from Hileah Companys financial information to build a template that automatically calculates (A) inventory turnover and (B) number of days sales in inventory, for the year 2018.arrow_forwardUse the last-in, first-out (LIFO) cost allocation method, with perpetual inventory updating, to calculate (a) sales revenue, (b) cost of goods sold, and c) gross margin for A75 Company, considering the following transactions.arrow_forwardCalculate the goods available for sale for Soros Company, in units and in $ (dollar amounts), given the following facts about their inventory for the period.arrow_forward
- Calculate the goods available for sale for Atlantis Company, in units and in dollar amounts, given the following facts about their inventory for the period:arrow_forwardThe following data pertain to 2012 activities of Twisp Industries: Use your completed worksheet to determine the firms cost of goods sold for 2012. Remember to change the year in row 24 and to enter new beginning inventory balances. Save the 2012 file as MFG3. Print the worksheet when done. If sales and other expenses were identical in 2011 and 2012, during which year did Twisp earn more income? Why?arrow_forwardUse the last-in, first-out method (LIFO) cost allocation method, with perpetual inventory updating, to calculate (a) sales revenue, (b) cost of goods sold, and c) gross margin for B75 Company, considering the following transactions.arrow_forward
- Use the weighted-average (AVG) cost allocation method, with perpetual inventory updating, to calculate (a) sales revenue, (b) cost of goods sold, and c) gross margin for A75 Company, considering the following transactions.arrow_forwardThe beginning inventory for Funky Party Supplies and data on purchases and sales for a three-month period are shown in Problem 7-1A. Instructions 1. Determine the inventory on March 31, 2016, and the cost of goods sold for the three-month period, using the first-in, first-out method and the periodic inventory system. 2. Determine the inventory on March 31, 2016, and the cost of goods sold for the three-month period, using the last-in, first-out method and the periodic inventory system. 3. Determine the inventory on March 31, 2016, and the cost of goods sold for the three-month period, using the weighted average cost method and the periodic inventory system. Round the weighted average unit cost to the nearest cent. 4. Compare the gross profit and the March 31, 2016, inventories, using the following column headings:arrow_forwardBased on the data in Exercise 7-15 and assuming that cost was determined by the FIFO method, show how the merchandise inventory would appear on the balance sheet.arrow_forward
- The following inventory data relate to Edwards, Inc.: Calculate the following for the year: a. Direct materials purchased. b. Direct labor costs incurred. c. Cost of goods sold. d. Gross profit.arrow_forwards Cruz Company uses LIFO for inventory costing and reports the following financial data. It also recomputed inventory and cost of goods sold using FIFO for comparison purposes. LIFO inventory LIFO cost of goods sold FIFO inventory FIFO cost of goods sold i Current assets (using LIFO) Current assets (using FIFO) Current liabilities 110 645 180 180 170 1. Compute its current ratio, inventory turnover, and days' sales in inventory for Year 2 using (a) LIFO numbers and (b) FIFO numbers. Year 2 $ 160 740 240 660 220 300 200 Current rabo Inventory tumover Days' sales in inventory (a) Compute its current ratio, Inventory turnover, and days' sales in inventory for Year 2 using LIFO numbers. Denominator Current ratio Inventory turnover have sales in invandrn Year 1 $ 110 680 Numerator (b) Computa its current ratio, inventory turnover, and days' sales in inventory for Year 2 uning FIFO numbers. Denominator Ratio Numerator Ratioarrow_forwardYou are examining the financial statements of France Company for the year ended December 31, 2022. It uses the physical inventory system of accounting for inventory. During your examination, you discovered that the 2023 sales of P 120,000 were recorded in 2022; goods were excluded in the 2022 ending inventory at a cost of 70,000. Based on the foregoing, answer the following questions: Question 1: Which of the following accounts is(are) overstated by P 120,000 at the end of year 2022 as a result of the error? Select 1 sales Onlv a. Sales and Accounts Receivable b. Inventory, December 31, 2022 only c. Retained Earnings only Question 2: Which of the following accounts is (are) understated by p 70,000 at the end of year 2022 as a result of the error? Select 1 a. retained earnings b. inventory, december 31,2022 c. sales and accounts receivable d. sales and retained earningsarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
Financial AccountingAccountingISBN:9781305088436Author:Carl Warren, Jim Reeve, Jonathan DuchacPublisher:Cengage Learning
College Accounting (Book Only): A Career ApproachAccountingISBN:9781337280570Author:Scott, Cathy J.Publisher:South-Western College Pub
Financial AccountingAccountingISBN:9781337272124Author:Carl Warren, James M. Reeve, Jonathan DuchacPublisher:Cengage Learning
Excel Applications for Accounting PrinciplesAccountingISBN:9781111581565Author:Gaylord N. SmithPublisher:Cengage Learning
Principles of Cost AccountingAccountingISBN:9781305087408Author:Edward J. Vanderbeck, Maria R. MitchellPublisher:Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
Financial Accounting
Accounting
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Cengage Learning
College Accounting (Book Only): A Career Approach
Accounting
ISBN:9781337280570
Author:Scott, Cathy J.
Publisher:South-Western College Pub
Financial Accounting
Accounting
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Cengage Learning
Excel Applications for Accounting Principles
Accounting
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Cengage Learning
Principles of Cost Accounting
Accounting
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Cengage Learning
Chapter 6 Merchandise Inventory; Author: Vicki Stewart;https://www.youtube.com/watch?v=DnrcQLD2yKU;License: Standard YouTube License, CC-BY
Accounting for Merchandising Operations Recording Purchases of Merchandise; Author: Socrat Ghadban;https://www.youtube.com/watch?v=iQp5UoYpG20;License: Standard Youtube License