Based on a physical inventory at year-end, Cherry Company determined the chocolate inventory on a FIFO basis at P2,600,000 with a replacement cost of P2,500,000. Cherry Company estimated that, after further processing costs of P 1,200,000, the chocolate could be sold as finished candy bars for P4,000,000. The normal profit margin is 10% of sales. What amount should be reported as chocolate inventory at year-end?

Q: The following lots of a particular commodity were available for sale during the year Beginning…

A: The stock of items in which firm deals are recorded as inventory in the books of the firm. The…

Q: .the FIFO inventory costing method. 2.the LIFO method. 3.From the resulting data, what conclusions…

A: Requirement 1:   FIFO method:

Q: Moss Co. has determined its year-end inventory on a FIFO basis to be $400,000. Information…

A: Given:Estimated selling price = $408,000Estimated costs to sell = $20,000

Q: What is the inventory conversion period for O'Brian's if it has sales of $320,000, an average…

A: The inventory conversion period is based on the concept of days of inventory take into sales. It can…

Q: Annanina Company reported the following information for the current year:   Beginning inventory…

A: Cost of goods available for sale is calculated by adding the cost of purchases with the beginning…

Q: Urban Technology began the year with inventory of $320,000 and purchased $1,800,000 of goods during…

A: Cost of goods available for sale = Beginning inventory + Purchases

Q: Sapphire Aerospace operates 52 weeks per year, and its cost of goods sold last year was $6,500,000.…

A: a) Working note:

Q: Marvin Company has a beginning inventory of 12 sets of paints at a cost of $1.50 each. During the…

A: Total units available for sale = 12+4+6+6+10 = 38 units Particulars No. of Units Cost per…

Q: 1. Assume the company does not expect to replace the units of beginning inventory sold; it plans to…

A: LIFO: In Last-in-First-Out method, items purchased recently are sold first. So, the value of the…

Q: A company adopted the LIFO method when its inventory was $1,800. One year later its ending inventory…

A: Value of inventory: One Year Later Value of ending inventory = ($ 1,800 X 1.00) + ($ 200 X 1.05)…

Q: The cost of goods sold for Veltron International last year amounted to $547,800, and the average…

A: The question is related to Ratio Analysis. Inventory turnover is calculated with the help of…

Q: Handbags, Inc. had 200 units of inventory on hand at the end of the year. These were recorded at a…

A: As per lower-of-cost-or-market rule Inventory will be recorded at lower of cost or market value.

Q: Win Company, which uses the FIFO inventory method, had 300,000 units ih inventory at the beginning…

A: Given, Company follows FIFO method;   Beginning Inventory = 300000 units Costing $ 50 each Details…

Q: Rizza Co. has an average age of inventory equal to 25 days. If its end of year inventory level is…

A: Average age of inventory = 25 days  Inventory level = P8,500

Q: a. EFG reports annual sales of $ 30 million. Annual costs of goods sold is $ 15 million. Inventory…

A: Inventory refers to the goods or items which are stored by the business either for selling or for…

Q: During the current period, Gleason Technology records total sales of $850,000, with a cost of…

A: Calculate  net sales for the Gleason Technology during the current period:

Q: Oriole Company had January 1 inventory of $291000 when it adopted dollar-value LIFO. During the…

A: Gross Profit = Sales - Cost of goods sold   Cost of goods sold = Beginning inventory + Purchases -…

Q: Volcano Technology began the year with inventory of $275,000 and purchased $1,850,000 of goods…

A: Inventory: Inventory refers to the stock of goods purchased, utilized and maintained by the company…

Q: According to a FIFO calculation, Montana Co. estimated its year-end inventory to be worth $649,000.…

A: As per inventory valuation method, the finished goods inventory on balance sheet are carried at…

Q: Tristan, Inc., uses the LIFO cost-flow assumption to value inventory. It began the current year with…

A: Particulars No. of units Rate per unit Total cost 9,500 units sold 8,000 $40 $320,000…

Q: The annual inventory requirement at the C &E Enterprises is P2,500 units. Each inventory item has a…

A: The annual inventory requirement at the C &E Enterprises is P2,500 units. Each inventory item…

Q: y taken on December 31, 2021. After further processing costs of P240,000, Racine estimated that the…

A: Correct Answer : c. 560,000   As per the Lower of Cost or Net Realizable Value Rule the inventory…

Q: Vibrant Company had $850,000 of sales in each of Year 1, Year 2, and Year 3, and it purchased…

A:

Q: At year-end, Delectable Company experienced a storm surge which caused severe damage to the entire…

A: Formula: Cost of good sold = Net Sales - Gross profit.

Q: The following information for Dorado Corporation relates to the three-month period ending September…

A: 1. Cost of goods sold (LIFO) = 400,000 units purchased at $24 each + 25,000 units from beginning…

Q: NewCorp reported $367,000 of inventory on January 1 when the company decided to adopt Dollar-Value…

A: The financial position of the company can be arrived from the income statement prepared by the…

Q: Vibrant Company had $950,000 of sales in each of Year 1, Year 2, and Year 3, and it purchased…

A: The gross profit is calculated as difference between sales and cost of goods sold. Cost of goods…

Q: The following is Cullumber Company’s income statement for the past year. Sales revenue   $336,000…

A: Gross margin % = (Gross margin / Sales) x 100 = (201,600/336,000)*100 = 60%

Q: Monroe Company had a beginning inventory of 350 cans of paint at $12 each on January 1 at a cost of…

A: Total cans purchased =Cans purchased on February 15 +Cans purchased on April 30 + Cans purchased…

Q: The cost of goods sold for Veltron International last year amounted to $547,800, and the average…

A: Inventory turnover refers to the rate at which the inventory in the company is sold, used, and…

Q: Terry Company had January 1 inventory of $100,000 when it adopted dollar-value LIFO.During the year,…

A: The closing stock is valued as above:

Q: Racine Co. determined its desiccated coconut inventory on a FIFO basis at P520,000 with a…

A: The financial position of the company can be arrived from the income statement prepared by the…

Q: The cost of goods sold for Veltron International last year amounted to $534,600, and the average…

A: The inventory turnover ratio can be calculated by dividing the cost of goods sold by average…

Q: Terry Company had January 1 inventory of $100,000 when it adopted dollarvalue LIFO. During the year,…

A: Given informationOpening stock (inventory) = $100000purchase = 600000Closing stock = 143360Base…

Q: Based on a physical inventory taken on December 31, 2020, ABC Co. determined its chocolate inventory…

A: As per the Lower of Cost or Net Realizable Value Rule the inventory will be valued at the lower of…

Q: At year-end 20X8, Ancho Canned Chile has 8,000 units on hand at a weighted-average cost of $13 per…

A: Ending inventory is computed by adding the beginning inventory and purchases and then subtracting…

Q: What is the average age of inventory for Patsy if it has sales of P320,000, an average inventory of…

A: The average age of inventory is calculated as daus in year divided by inventory turnover ratio.

Q: Vaughn Manufacturing began using dollar-value LIFO for costing its inventory two years ago. The…

A: Solution: Computation of inventory at base year prices and change from prior year - David Davis…

Q: Based on a physical inventory taken on December 31. 2019. City Company determined its chocolate…

A: Stock is to be valued at cost or net realizable value which every is lower. Prudence concepts says…

Q: Traylor Corporation began the year with three items in beginning inventory, each costing $5. During…

A: Particulars Units Price per unit Total value Beginning inventory 3 $5 $15 Purchases 5 $6 $30…

Q: Purple Company had sales of P4,000,000 during December of the current year. Experience has shown…

A: Introduction:- The following basic information as follows under:- Purple Company had sales of…

Q: The following information for Quadrado Corporation relates to the three-month period ending…

A: Formula: Gross profit = Sales - cost of goods sold

Q: Based on physical inventory at year-end, Cherry Company determined the chocolate inventory on a FIFO…

A: Inventory is reporter at Lower of Cost of Net realizable value. where, Net relizable value =…

Q: Anthony Corporation reported the following amounts for the year:           Net sales $ 296,000…

A: Inventory turnover = Cost of goods sold / Average inventory = $138,000/50000 = 2.76

Q: In December year 1, Johnny corporation produced three products that it still has in inventory at…

A: Inventory refers to the stock that the company held for resale purposes or which is not sold in the…

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.