5. Hemming Co. reported the following current-year purchases and sales for its only product. Date Activities Units Acquired at Cost Units Sold at Retail Jan. 1 Beginning inventory... 200 units e $10 =$ 2,000 Jan. 10 Sales.. 150 units@ $40 Mar. 14 Purchase 350 units @ $15 = 5,250 Mar. 15 Sales. 300 units @ $40 July 30 Purchase 450 units @ $20 = 9,000 Ot. Sales. 430 units @ $40 Oct. 26 Purchase 100 units @ $25 = 2,500 Totals 1,100 units $18,750 880 units Required Hemming uses a perpetual inventory system. Detemine the costs assigned to ending inventory and to cost of goods sold using (a) FIFO and (b) LIFO. (c) Compute the gross margin for each method. (Round amounts to cents.) 6. Palmona Co. establishes a $200 petty cash fund on January 1. On January 8, the fund shows $38 in cash along with receipts for the following expenditures: postage, $74; transportation-in, $29; delivery expenses, $16; and miscellaneous expenses, $43. Palmona uses the perpetual system in accounting for merchandise inventory. Prepare journal entries to (1) establish the fund on January 1, (2) reimburse it on January 8, and (3) both reimburse the fund and increase it to $450 on January 8, assuming no entry in part 2. Hint: Make two separate entries for part 3. 7. Prepare journal entries to record the following transactions of Ridge Company. Mar. 21 Accepted a $9,500, 180-day, 8% note from Tamara Jackson in granting a time extension on her past-due account receivable. Sep. 17 Jackson dishonored her note. Dec. 31 After trying several times to collect, Ridge Company wrote off Jackson's account against the Allowance for Doubtful Accounts.
5. Hemming Co. reported the following current-year purchases and sales for its only product. Date Activities Units Acquired at Cost Units Sold at Retail Jan. 1 Beginning inventory... 200 units e $10 =$ 2,000 Jan. 10 Sales.. 150 units@ $40 Mar. 14 Purchase 350 units @ $15 = 5,250 Mar. 15 Sales. 300 units @ $40 July 30 Purchase 450 units @ $20 = 9,000 Ot. Sales. 430 units @ $40 Oct. 26 Purchase 100 units @ $25 = 2,500 Totals 1,100 units $18,750 880 units Required Hemming uses a perpetual inventory system. Detemine the costs assigned to ending inventory and to cost of goods sold using (a) FIFO and (b) LIFO. (c) Compute the gross margin for each method. (Round amounts to cents.) 6. Palmona Co. establishes a $200 petty cash fund on January 1. On January 8, the fund shows $38 in cash along with receipts for the following expenditures: postage, $74; transportation-in, $29; delivery expenses, $16; and miscellaneous expenses, $43. Palmona uses the perpetual system in accounting for merchandise inventory. Prepare journal entries to (1) establish the fund on January 1, (2) reimburse it on January 8, and (3) both reimburse the fund and increase it to $450 on January 8, assuming no entry in part 2. Hint: Make two separate entries for part 3. 7. Prepare journal entries to record the following transactions of Ridge Company. Mar. 21 Accepted a $9,500, 180-day, 8% note from Tamara Jackson in granting a time extension on her past-due account receivable. Sep. 17 Jackson dishonored her note. Dec. 31 After trying several times to collect, Ridge Company wrote off Jackson's account against the Allowance for Doubtful Accounts.
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter6: Cost Of Goods Sold And Inventory
Section: Chapter Questions
Problem 51E: Inventory Costing Methods On June 1, Welding Products Company had a beginning inventory of 210 cases...
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Transcribed Image Text:Hemming Co. reported the following current-year purchases and sales for its only product.
Date
Activities
Units Acquired at Cost
Units Sold at Retail
Jan.
Beginning inventory..
200 units @ $10 = $ 2,000
Jan. 10
Sales..
150 units @ $40
Mar. 14
Purchase
350 units @ $15 = 5,250
Mar. 15
Sales...
300 units @ $40
July 30
Purchase
450 units @ $20 =
9,000
Oct. 5
Sales..
430 units @ $40
Oct. 26
Purchase
100 units @ $25 = 2,500
Totals
1,100 units
$18,750
880 units
Required
Hemming uses a perpetual inventory system. Determine the costs assigned to ending inventory and to cost
of goods sold using (a) FIFO and (b) LIFO. (c) Compute the gross margin for each method. (Round
amounts to cents.)
6.
Palmona Co. establishes a $200 petty cash fund on January 1. On January 8, the fund shows $38 in cash
along with receipts for the following expenditures: postage, $74; transportation-in, $29; delivery expenses,
$16; and miscellaneous expenses, $43.
Palmona uses the perpetual system in accounting for merchandise inventory. Prepare journal entries to
(1) establish the fund on January 1, (2) reimburse it on January 8, and (3) both reimburse the fund and
increase it to $450 on January 8, assuming no entry in part 2. Hint: Make two separate entries for part 3.
7.
Prepare journal entries to record the following transactions of Ridge Company.
Mar. 21
Accepted a $9,500, 180-day, 8% note from Tamara Jackson in granting a time extension on her
past-due account receivable.
Sep. 17 Jackson dishonored her note.
Dec. 31
After trying several times to collect, Ridge Company wrote off Jackson's account against the
Allowance for Doubtful Accounts.
5.
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