Intermediate Accounting, 10 Ed
10th Edition
ISBN: 9781260310177
Author: Mark W. Nelson, Wayne B. Thomas J. David Spiceland
Publisher: McGraw-Hill Education
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Textbook Question
Chapter 9, Problem 9.8BE
Retail inventory method; LIFO
• LO9–3
Refer to the situation described in BE 9–7. Estimate ending inventory and cost of goods sold (LIFO).
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Students have asked these similar questions
31. Apply the Retail Inventory Method to calculate the cot of ending invery
Cost
Beginning inventory
Net purchanes
Sales
Ratail
$20.224 $31600
59.508 97000
.00
2) Sea Travel sells motor boats. One of Sea Travel's most popular models is the Wing. During the
current year, Sea Travel purchased 24 Wings at the following costs.
Total cost
Unit Cost
$7000
$7100
$7250
Purchase Date
Units Purchased
May 2
May 20
May 25
$28,000
14,200
4
8
58000
June 5
10
$7300
73000
24
$173,200
On May 28, Sea Travel sold 11 Wings to the jack Sport racing team.
Compute
a) the cost of goods sold on May 28 and
b) The ending inventory of Wing boats at June 5, using the following cost flow assumptions:
c) Prepare journal entries to record the cost of the 11 wings sold on May 28, assuming that the
company uses the:
7/
Which one of the following methods can be applied in situations where different purchases can be physically separated, and each item sold and remaining in inventory is identified?
a.
All
b.
First In First Out (FIFO)
c.
Specific Identification
d.
Weighted Average
Chapter 9 Solutions
Intermediate Accounting, 10 Ed
Ch. 9 - Explain the (a) lower of cost or net realizable...Ch. 9 - What are the various levels of aggregation to...Ch. 9 - Describe the alternative approaches for recording...Ch. 9 - Explain the gross profit method of estimating...Ch. 9 - The Rider Company uses the gross profit method to...Ch. 9 - Explain the retail inventory method of estimating...Ch. 9 - Both the gross profit method and the retail...Ch. 9 - Define each of the following retail terms: initial...Ch. 9 - Explain how to estimate the average cost of...Ch. 9 - Prob. 9.10Q
Ch. 9 - Explain the LIFO retail inventory method.Ch. 9 - Discuss the treatment of freight-in, net markups,...Ch. 9 - Explain the difference between the retail...Ch. 9 - Prob. 9.14QCh. 9 - Prob. 9.15QCh. 9 - Explain the accounting treatment of material...Ch. 9 - Identify any differences between U.S. GAAP and...Ch. 9 - (Based on Appendix 9) Define purchase commitments....Ch. 9 - (Based on Appendix 9) Explain how purchase...Ch. 9 - Lower of cost or net realizable value LO91 Ross...Ch. 9 - Lower of cost or net realizable value LO91 SLR...Ch. 9 - Lower of cost or market LO91 [This is a variation...Ch. 9 - Lower of cost or market LO91 [This is a variation...Ch. 9 - Prob. 9.5BECh. 9 - Gross profit method; solving for unknown LO92...Ch. 9 - Retail inventory method; average cost LO93 Kiddie...Ch. 9 - Retail inventory method; LIFO LO93 Refer to the...Ch. 9 - Conventional retail method LO94 Refer to the...Ch. 9 - Conventional retail method LO94 Roberson...Ch. 9 - Lower of cost or net realizable value LO91 Herman...Ch. 9 - Lower of cost or net realizable value LO91 The...Ch. 9 - Lower of cost or market LO91 [This is a variation...Ch. 9 - Lower of cost or market LO91 [This is a variation...Ch. 9 - Prob. 9.11ECh. 9 - Concepts; terminology LO91 through LO97 Listed...Ch. 9 - Prob. 9.1PCh. 9 - Prob. 9.3PCh. 9 - Prob. 9.8PCh. 9 - Prob. 9.1DMPCh. 9 - Prob. 9.3DMPCh. 9 - Prob. 9.4DMPCh. 9 - Prob. 9.5DMPCh. 9 - Prob. 9.6DMPCh. 9 - Prob. 9.7DMPCh. 9 - Real World Case 98 Various inventory issues;...Ch. 9 - Prob. 9.9DMPCh. 9 - Judgment Case 910 Inventory errors LO97 Some...Ch. 9 - Prob. 9.12DMPCh. 9 - Prob. 2CCTC
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- Exercise 5-3 (Algo) Perpetual: Inventory costing methods LO P1 Assume the perpetual inventory system is used. Required: Complete the table to determine the cost assigned to ending inventory and cost of goods sold using specific identification. Determine the cost assigned to ending inventory and to cost of goods sold using weighted average. Determine the cost assigned to ending inventory and to cost of goods sold using FIFO. Determine the cost assigned to ending inventory and to cost of goods sold using LIFO.arrow_forwardQuestion 25 25. (CLO5, PLO5, ZULO1) The journal entry for purchase of inventory on account will require a: O debit to cost of goods sold and credit to inventory debit to sales returns and credit to revenues debit to inventory and credit to accounts payable debit to inventory and credit to accounts receivablearrow_forwardLower-of-Cost-or-Market Method On the basis of the data shown below: Item InventoryQuantity Cost perUnit Market Value per Unit(Net Realizable Value) A13Y 152 $49 $52 O5T4 290 25 22 Determine the value of the inventory at the lower of cost or market by applying lower of cost or market to each inventory item, as shown in Exhibit 9. $arrow_forward
- 1a The inventory cost flow method that reports the earliest costs in ending inventory is a. LIFO b. weighted average cost c. FIFO d. specific identificationarrow_forward43. Using FIFO method, how much is the ending inventory?arrow_forwardPA9. 10.3 Calculate a) cost of goods sold, b) ending inventory, and c) gross margin for A76 Company, considering the following transactions under three different cost allocation methods and using perpetual inventory updating. Provide calculations for first-in, first-out (FIFO). a anal Accountingp x+ eburowner abcocteunccT atructorm.omesourcese oand.oeyeinancia.conccountingpar = Contes O Ote p IA t 700 of soss LD Pegevie 692 Chapter 10 Inventory PA9. LO 10.3 Calculate a) cost of goods sold, b) ending inventory, and c) gross margin for A76 Company, considering the following transactions under three different cost allocation methods and using perpetual inventory updating. Provide calculations for first-in, first-out (FIFO). Number of Units Unit Cost Sales Beginning inventory Sold Purchased Sold Purchased Sold Ending inventory 240 160 520 $100 $140 103 400 400 142 110 370 144 230arrow_forward
- A v2.cengagenow.com Lower-of-Cost-or-Market Method On the basis of the following data, determine the value of the inventory at the lower-of-cost-or-market by applying lower-of-cost-or-market to each inventory item, as shown in Exhibit 10. Market Value per Unit Item Inventory Quantity Cost per Unit (Net Realizable Value) JFW1 58 $29 $24 SAW9 119 15 20 Check My Work Previous Next All work saved. Save and Exit Submit Assignment for Grac %24arrow_forwardQ-1: What is Perpetual and Periodic Inventory System? Explain the differences between both. Record all the transactional entries for the sales and purchases of inventory.arrow_forwardLower-of-Cost-or-Market Method On the basis of the data shown below: Inventory Item Quantity Cost per Unit Market Value per Unit (Net Realizable Value) JFW1 5,750 $9 $10 SAW9 1,040 27 24 Determine the value of the inventory at the lower of cost or market. Apply lower of cost or market to each inventory item, as shown in Exhibit 9. 76,710arrow_forward
- Presented below is information related to Cheyenne Company. Beginning inventory Purchases Markups Markup cancellations Markdowns Markdown cancellations Sales revenue Cost Retail $362,797 $286,000 1,370,000 2,145,000 95,100 14,800 32,900 5,100 2,193,000arrow_forwardFinf the Cost of goods sold and Ending inventory under FIFOarrow_forwardQUESTION 9: The cost-to-retail ratio which is computed under the conventional retail inventory method (or LCNRV) is calculated: a. After markups (net) and before markdowns (net). b. Before both markups (net) and markdowns (net). c. After both markups (net) and markdowns (net). d. After markdowns (net) and before markups (net).arrow_forward
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