REQUIRED:a. Compute cost of goods sold and gross profit using an inventory scheduleb. Compute the cost of the building and the annual depreciation expense using thestraight-line method.c. Prepare a depreciation schedule for the equipment, clearly showing the annualdepreciation expense, accumulated depreciation and net book value for each of itsuseful life.d. Prepare the journal entries to record the 2021 depreciation.e. Prepare the adjusting entry for bad debt expense under the following independentassumptions:i.The company estimates that 1% of sales (determined from the inventoryschedule above) will be uncollectibleAn aging schedule indicates that $14,800 of accounts receivable will beii.uncollectible.f. Explain to Chad the economic unit assumption and two (2) differences between thebusiness type he was operating before July 2021 and Goldy Inc. Problem 3Inventories, Depreciation & Accounting for ReceivablesChad Goldman was operating a gold business on his own prior to starting the Company,Goldy Inc. in July 2021. He has to organize his financial records and asked for yourassistance in specific areas.The following information about the company for the month of July 2021, is as follows:July 1July 1Beginning inventory 100 gold at a cost of $340 per gold unit.Purchased equipment for $280,000.July 3Purchased 200 gold at a cost of $350 each.July 5Sold 180 gold for $730 each.July 1075 gold units from the sale on July 5 were returned to inventory.July 11Purchased 350 gold at a cost of $380 each.July 25Sold 400 gold for $750 each.Purchased a building with a cash price of $450,000, Člosing Cost amountedto $25,000 and remodeling charges of $45,000.July 31NOTES:v The company implemented the FIFO cost flow assumption and a perpetual inventorysystem.V The building purchased on July 31 has an estimated useful life of 8 years and residualvalue of $40,000. The building uses the straight-line method of depreciation.V The equipment purchased on July 1 has an estimated useful life of the 5 years and aresidual value of $30,000. The equipment uses the double-declining method ofdepreciation.V The company financial year-end is December 31st and a credit balance of $3,800 inAllowance for Doubtful Accounts.

As per the guidelines we can solved 3 parts of any question. answer for remaining part of the…

REQUIRED: a. Compute cost of goods sold and gross profit using an inventory schedule b. Compute the cost of the building and the annual depreciation expense using the straight-line method. c. Prepare a depreciation schedule for the equipment, clearly showing the annual depreciation expense, accumulated depreciation and net book value for each of its useful life.

REQUIRED: a. Compute cost of goods sold and gross profit using an inventory schedule b. Compute the cost of the building and the annual depreciation expense using the straight-line method. c. Prepare a depreciation schedule for the equipment, clearly showing the annual depreciation expense, accumulated depreciation and net book value for each of its useful life.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter2: The Accounting Information System

Section: Chapter Questions

Problem 18CE: CORNERSTONE 2.1 Four statements are given below. Pewterschmidt Company values its inventory reported...

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