Question VI - On January 20, 2011, the records of the Stewart Company revealed the following information: Inventory, July 1, 2010 Purchases, July 1, 2010-January 20, 2011 Sales, July 1, 2010-January 20, 2011 Purchases returns. $ 53,600 368,000 583,000 11,200 Purchases discounts taken $5,800 Freight-in Sales returns 3,800 6,600 A fire destroyed the entire inventory on January 20, 2011 except for purchases in transit, FOB shipping point of $6,000, and goods having a selling price of $4,700 that were salvaged from the fire. The salvaged goods had an estimated cost of $2,900. The average gross profit on net sales in previous periods was 40%. 1. Compute the cost of the inventory lost in the fire.

Question VI - On January 20, 2011, the records of the Stewart Company revealed the following information: Inventory, July 1, 2010 Purchases, July 1, 2010-January 20, 2011 Sales, July 1, 2010-January 20, 2011 Purchases returns. $ 53,600 368,000 583,000 11,200 Purchases discounts taken $5,800 Freight-in Sales returns 3,800 6,600 A fire destroyed the entire inventory on January 20, 2011 except for purchases in transit, FOB shipping point of $6,000, and goods having a selling price of $4,700 that were salvaged from the fire. The salvaged goods had an estimated cost of $2,900. The average gross profit on net sales in previous periods was 40%. 1. Compute the cost of the inventory lost in the fire.

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

Chapter8: Inventories: Special Valuation Issues

Section: Chapter Questions

Problem 12P

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Part B The company completed the following transactions during 2020. Jan 10 sold inventory to Natty Paul, $11,000, on account May 15 wrote off as uncollectible the accounts of Terry Carter, $2,500 and Maggie Cube $400 August 04 received 70% of the amount owed by Natty Paul and wrote off the remainder as uncollectible October 26 received 30% of the funds owed from Maggie Cube as part payment of her account which had been written off earlier as uncollectible. December 31, The Aging schedule showed an estimated $116,500 as uncollectible Requirements: Prepare journal entries for each transaction (No narrations required) Prepare the Allowance for Uncollectible and the Accounts Receivable accounts based on the information presented and balance off each account. Prepare the balance sheet extract as at Dec 31, 2020, to show the net realizable value for the Accounts Receivable. Assume credit sales for 2019 were $312,000 and that on December 31, 10% of credit sales are estimated to be…
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Question 3: On 20 June 2019 , the warehouse and attached business premises of Fashion Wear Cloth Mill SAOC were affected by fire. The following information is available from the salvaged books of account. Amount (OMR) Stock of goods @ 10% lower than cost as on January 1, 2019 216,000 Purchases less returns (January 1, 2019, to June 20, 2019) 280000 Sales less returns (January 1, 2019, to June 20, 2019) 620000 Additional Information : Sales up to June 20, 2019, include OMR 80,000 worth of goods which had not been dispatched. Purchases up to June 20, 2019, did not include OMR 40,000 worth of goods for which purchase invoices had not been received from the suppliers, but the goods had been received in stored in the warehouse. Past records show the gross profit rate of 25 % Value of goods salvaged OMR 31,000 Fashion Wear had insured their stock for OMR 85,000. You are required to compute the amount of claim to be lodged with the insurer justifying the…