Oriole Corporation had the following items in inventory as at December 31, 2020: Item No. Quantity Unit Cost NRV A1 180 $2.90 $2.90 B4 140 1.40 0.50 C2 220 9.10 10.60 D3 90 6.60 6.50 Assume that Oriole uses a periodic inventory system, and that none of the inventory items can be grouped together for accounting purposes. The opening inventory on January 1, 2020, was $3,200 in total. Prepare the year-end adjusting entries required to adjust to the lower of cost or net realizable value using the direct method. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Direct Method: Date Account Titles and Explanation Debit Credit December 31, 2020 (To transfer out beginning inventory balance) December 31, 2020 (To record ending inventory at LC and NRV) List of Accounts Prepare the year-end adjusting entries required to adjust to the lower of cost or net realizable value using the indirect method. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Indirect Method: Date Account Titles and Explanation Debit Credit December 31, 2020 (To transfer out beginning inventory balance) December 31, 2020 (To record ending inventory at cost) December 31, 2020 (To write-down inventory to lower NRV)
Oriole Corporation had the following items in inventory as at December 31, 2020: Item No. Quantity Unit Cost NRV A1 180 $2.90 $2.90 B4 140 1.40 0.50 C2 220 9.10 10.60 D3 90 6.60 6.50 Assume that Oriole uses a periodic inventory system, and that none of the inventory items can be grouped together for accounting purposes. The opening inventory on January 1, 2020, was $3,200 in total. Prepare the year-end adjusting entries required to adjust to the lower of cost or net realizable value using the direct method. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Direct Method: Date Account Titles and Explanation Debit Credit December 31, 2020 (To transfer out beginning inventory balance) December 31, 2020 (To record ending inventory at LC and NRV) List of Accounts Prepare the year-end adjusting entries required to adjust to the lower of cost or net realizable value using the indirect method. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Indirect Method: Date Account Titles and Explanation Debit Credit December 31, 2020 (To transfer out beginning inventory balance) December 31, 2020 (To record ending inventory at cost) December 31, 2020 (To write-down inventory to lower NRV)
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter22: Accounting For Changes And Errors.
Section: Chapter Questions
Problem 3P: Koopman Company began operations on January 1, 2018, and uses they FIFO inventory method for...
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Question
Oriole Corporation had the following items in inventory as at December 31, 2020:
Assume that Oriole uses a periodic inventory system, and that none of the inventory items can be grouped together for accounting purposes. The opening inventory on January 1, 2020, was $3,200 in total.
| Item No. | Quantity | Unit Cost |
NRV | |||||||
| A1 | 180 | $2.90 | $2.90 | |||||||
| B4 | 140 | 1.40 | 0.50 | |||||||
| C2 | 220 | 9.10 | 10.60 | |||||||
| D3 | 90 | 6.60 | 6.50 |
Assume that Oriole uses a periodic inventory system, and that none of the inventory items can be grouped together for accounting purposes. The opening inventory on January 1, 2020, was $3,200 in total.
Prepare the year-end adjusting entries required to adjust to the lower of cost or net realizable value using the direct method. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Direct Method:
Direct Method:
|
Date
|
Account Titles and Explanation
|
Debit
|
Credit
|
| December 31, 2020 |
|
|
|
|
|
|
||
| (To transfer out beginning inventory balance) | |||
| December 31, 2020 |
|
|
|
|
|
|
||
| (To record ending inventory at LC and NRV) |
List of Accounts
Prepare the year-end adjusting entries required to adjust to the lower of cost or net realizable value using the indirect method. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Indirect Method:
Indirect Method:
|
Date
|
Account Titles and Explanation
|
Debit
|
Credit
|
| December 31, 2020 |
|
|
|
|
|
|
||
| (To transfer out beginning inventory balance) | |||
| December 31, 2020 |
|
|
|
|
|
|
||
| (To record ending inventory at cost) | |||
| December 31, 2020 |
|
|
|
|
|
|
||
| (To write-down inventory to lower NRV) |
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