Acc 422 Week 2 Wileyplus Assignment - Exercises

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ACC 422 Week 2 WileyPlus Assignment - Exercises
Business - Accounting

ACC422 Week 2 E7-2 E7-8 E8-5 E8-14 P7-1 E8-25

E7-2 (Determine Cash Balance) Presented below are a number of independent situations.

Instructions

For each individual situation, determine the amount that should be reported as cash. If the item(s) is not reported as cash, explain the rationale.

1. Checking account balance $925,000; certificate of deposit $1,400,000; cash advance to subsidiary of $980,000; utility deposit paid to gas company $180.

2. Checking account balance $500,000; an overdraft in special checking
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8. Excluded from inventory was a carton labeled “Please accept for credit.” This carton contains merchandise costing $1,500 which had been sold to a customer for $2,600. No entry had been made to the books to reflect the return, but none of the returned merchandise seemed damaged.

Instructions
(a) Determine the proper inventory balance for Werth Company at December 31, 2010.
(b) Prepare any correcting entries to adjust inventory to its proper amount at December 31, 2010. Assume the books have not been closed.

E8-14 (FIFO, LIFO, and Average Cost Determination) LoBianco Company’s record of transactions for the month of April was as follows.
Purchases Sales
April 1 (balance on hand) 600 @ $6.00 April 3 500 @ $10.00
4 1,500 @ 6.08 9 1,300 @ 10.00
8 800 @ 6.40 11 600 @ 11.00
13 1,200 @ 6.50 23 1,200 @ 11.00
21 700 @ 6.60 27 900 @ 12.00
29 500 @ 6.79 4,500
5,300

Instructions
(a) Assuming that periodic inventory records are kept, compute the inventory at April 30 using (1) LIFO and (2) average cost.
(b) Assuming that perpetual inventory records are kept in both units and dollars, determine the inventory at April 30 using (1) FIFO and (2) LIFO.
(c) Compute cost of goods sold assuming periodic inventory procedures and inventory priced at FIFO.
(d) In an inflationary period, which inventory method—FIFO, LIFO, average cost—will show the highest net income?

P7-1 (Determine Proper Cash Balance) Francis Equipment Co. closes its books regularly