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- Question 2 The following information is available for Headlands Industries for three recent fiscal years. 2022 2021 2020 Inventory $568,000 $578,000 $345,000 Net sales 1,910,000 1,775,000 1,355,000 Cost of goods sold 1,375,200 1,153,750 934,000 (a)Calculate the inventory turnover, days in inventory, and gross profit rate for 2022 and 2021. (Round inventory turnover to 1 decimal place, e.g. 5.2, days in inventory to 0 decimal places, e.g. 125 and gross profit rate to 1 decimal place, e.g. 5.2%.) 2022 2021 Inventory Turnover enter an inventory turnover times enter an inventory turnover times Days in Inventory enter a number of days days enter a number of days days Gross Profit Rate enter percentages % enter percentages %inv 3Company A sells only one product X. At the inventory on 31/12/20X5 it was found that there were 500 pieces of X in the warehouse at a cost of EUR 30 per piece. The net realisable market value of X was estimated at EUR 28 per piece but X also has a written non-cancellable agreement to sell 300 pieces of X to company B at EUR 31 per piece. At what value will X's stock be valued?In FY20X6 all the beginning inventory was sold. In particular, the 200 pieces that were valued to KAP were sold at € 35 per piece.Carry out the journal entries resulting from the above events up to the calculation of gross profit.Question 2. Richerfold Ltd had the following transactions and 2020: inventory valued at $3,500,000 as at January 1, 2020 with an obsolete/spoilage stock provision of 4%. In May 2020 the company upgraded its refrigeration storage facilities which allowed the business to store items longer and reduce spoilage. The obsolete stock provision was reviewed and changed to 2%. The inventory balance at December 31, 2020 was $2,250,000. The accounts receivable as at January 1, 2020 was $245,000 and the bad provision was 3% however due to the economic downturn in 2020 the company increased the provision to 5%. The accounts receivable was $800,000 at Dec 31, 2020. Calculate the provision for obsolete stock and bad debts and prepare the respective journal entries at December 31, 2020 The following errors were discovered in 2021: A compressor costing $250,000 for the refrigeration storage facilities purchased on April 1, 2020 was expensed in 2020. Depreciate straight line for 10 years.…
- Question 3: The financial year of Mitex Co ended on 31 December 20X1. An inventory count on January 4, 20X2 gave a total inventory value of $527,300. The following transactions occurred between January 1 and January 4. Purchases of goods $7,900 Sales of goods (gross profit margin 40% on sales) $15,000 Goods returned to a supplier $800 What inventory value should be included in Mitex Co’s financial statements at 31 December 20X1?Ma4. Question 42. The cost of inventory that has been sold to customers is called: A. cost of goods sold, and it appears on the income statement. B.inventory, a current asset that appears on the balance sheet. C.inventory, a current asset that appears on the income statement. D.cost of goods sold, and it appears on the balance sheet. Question 43. ABC Company sold $120,000 of goods and accepted the customer's $120,000 10%, 1- year note in exchange. Assuming 10% approximates the market rate of return, how much interest would be recorded for the year ending December 31 if the sale was made on June 30? A.12,000 B. 3,000 C.0 D. 6,000 Question 44 Under the allowance method of recognizing uncollectible accounts, the entry to write off an uncollectible account A.increases the allowance for uncollectible accounts. B.has no effect on the allowance for uncollectible accounts. C.decreases net income. D. has no effect on net income.PROBLEM 6: XXX Company is preparing its 2021 financial statements. Prior to any adjustments, inventory is valued at P1,605,000. The following information has been found relating to certaininventory transactions from your cut-off test: A. Goods valued at P110,000 are on consignment with a customer. These goods werenot included in the ending inventory figure. B.Goods costing P87,000 were received from a vendor on January 5, 2022. The relatedinvoice was received and recorded on January 12, 2022. The goods were shippedonDecember 31, 2021, terms FOB shipping point. C. Goods costing P85,000, sold for P102,000, were shipped on December 31, 2021, andwere delivered to the customer on January 2, 2022. The terms of the invoice wereFOBshipping point. The goods were included in the ending inventory for 2021 and thesalewas recorded in 2022. D. A P35,000 shipment of goods to a customer on December 31, terms FOB destinationwas not included in the year-end inventory. The goods cost P26,000…
- Question 2 A) Haly Ltd, a Limited Liability Company, maintains inventory on Average Cost (AVCO) bases. On 1 January 2020, it had opening inventory of 300 units at OMR 10 per unit. The following transactions in respect of Material ‘abc’ occurred during the month of January 2020. Month Purchase (Units) Price per unit (OMR) Issued (Units) 2 January 2020 1200 12 3 January 2020 500 10 January 2020 900 13 15 January 2020 1200 20 January 2020 600 14 29 January 2020 800 A) Using Average Cost (AVCO) Method, you are required to calculate: 1) Cost of inventory as on 31 January 2020 2) Cost of goods sold during the month of January 2020. Show all the workings clearly. Molly Ltd produced goods in batches. On 1 January 2020 it had Opening WIP of 7,500 units, 80% completed. Also, Molly Ltd started and completed 18,000 units in the month of January 2020. By the end of January…Problem 13On the December 31, 2020 balance sheet of Mann Co., the current receivables consisted ofthe following:Trade accounts receivable 93,000Allowance for uncollectible accounts (2,000)Claim against shipper for goods lost in transit (November 2020) 3,000Selling price of unsold goods sent by Mann on consignment at130% of cost (not included in Mann’s ending inventory) 26,000Security deposit on lease of warehouse used for storing some inventories 30,000Total 150,000On December 31, 2020, the correct total of Mann’s current net receivables was _________. Problem 14The following information relates to Jay Co.’s accounts receivable for 2020:Accounts receivable, 1/1/20 650,000Credit sales for 2020 2,700,000Sales returns for 2020 75,000Accounts written off during 2020 40,000Collections from customers during 2020 2,150,000Estimated future sales returns at 12/31/20 50,000Estimated uncollectible accounts at 12/31/20 110,000What amount should Jay report for accounts receivable, before allowances…Problem 13 Four Company, which maintains it inventory using the perpetual system, had the followingbalances at the end of the year: Cost of Goods Sold 4,500,000Net Sales 6,000,000Inventory 1,200,000Accounts Payable 3,000,000Accounts Receivable 4,000,000 Compute the adjusted balances of the above items after considering the following information:-Four consigned to Ellie, at the beginning of December 2020, goods costing P100,000 andpaid freight of P5,000. The relevant commission is 5% of the selling price of P200,000. Bythe end of the year, Ellie has not remitted yet any of the sales but reported on January 5,2021 that by December 31, 2020, all of the goods were sold. The said inventory wasincluded in the physical count of the company.- The company sold on FOB shipping point goods costing P200,000 at selling price which is150% of cost on December 29, 2020, sale was recognized on the said date, and goodswere excluded from the inventory count. It was later found out that said goods were…
- Problem 43. The following assets are acquired on January 1, 2015, when the general price index is 200:Inventory P1,000,000Property, plant and equipment 2,000,000Investment in Bonds Receivable 3,000,000The company is reporting in a hyperinflationary economy. On December 31, 2015, the general priceindex is 300. How shall the assets above be presented in the 12/31/2015 Statement of FinancialPosition? Problem 44. The statement of financial position of ART Inc. before translation to hyperinflationaryeconomy is presented as follows:Cash 1,000,000 Accounts payable 1,000,000Accounts receivable 2,000,000 Unearned revenue (1/1/2015) 1,500,000Inventory (1/1/2015) 3,000,000 Ordinary share (1/1/2015) 2,000,000PPE (7/1/2015) 4,000,000 Retained earnings 500,000The general price index are provided for the following dates:1/1/2015 – 100 7/1/2015 – 200 12/31/2015 – 300How much retained earnings shall be presented in the translated statement of financialposition of ART Inc. in a hyperinflationary…Problem 10 Refer to Problem 9.(Problem 9 The financial statement of mythical Reliance Inc.show that in 2012, its beginning inventory balance was$31.82 billion and ending inventory balance was $30.25billion. The company's cost of goods sold was reported as $290.70 billion(all in U.S. dollars). Calculate the company's inventory turnover ratio for 2012.) What is Reliance Inc.'s days ofinventory in stock if, in 2013, the company's beginning inventory balance was $30.25 billion, its ending inventorybalance was $29.12 billion, and the cost of goods sold was $272.22 billion?Question 4Syarikat Layang uses the LIFO (Last-in, First-out) costing method for its perpetualinventory system. It had inventory on 1 January 2021 consisting of 400 articles boughtat RM4 each. The purchases during the month of January consisted of 800 at RM4.20each purchased on 8 January, and 2,000 at RM3.80 each on 18 January. It sold 2,400at RM5.00 each on 28 January. 40 of those sold were returned in perfect condition on31 January. The returned goods were bought on 18 January.Required: a. i. Calculate, by means of an inventory account the number and cost of the articles held in inventory during January 2021. ii. The unit price and total cost of the inventory. b. Show the trading account for the month ended 31 January 2021.