Statement of Financial Position as at December 31, 2021 2020 2021 Non-current assets GHC GHC GHC GHC Motor vehicles at cost 150,000 185,000 (90,000) 60,000 (90,000) 95,000 Less Accumulated depreciation Machinery at cost 70,000 Less Accumulated depreciation (5,000) 65,000 60,000 160,000 Current assets Inventory 75,000 67,500 Receivables 45,000 60,000 Bank 30,000 150,000 127,500 287,500 210,000 Total assets Current liabilities Payables 22,500 26,260 Bank overdraft 20,000 22,500 46,260 Non-current liability Loan 90,000 120,000 Financed by: Stated capital 37,500 31.240 Net profit 60,000 90,000 97,500 121,240 Total equity and liabilities 210,000 287,500 Additional information • A motor vehicle which had cost GHC45,000 with a written down value of GHC15,000 had been sold for GHC 19,160. Required: Prepare the Statement of Cash-flow for Boakye Limited for the year ended December 31, 2021.

Statement of Financial Position as at December 31, 2021 2020 2021 Non-current assets GHC GHC GHC GHC Motor vehicles at cost 150,000 185,000 (90,000) 60,000 (90,000) 95,000 Less Accumulated depreciation Machinery at cost 70,000 Less Accumulated depreciation (5,000) 65,000 60,000 160,000 Current assets Inventory 75,000 67,500 Receivables 45,000 60,000 Bank 30,000 150,000 127,500 287,500 210,000 Total assets Current liabilities Payables 22,500 26,260 Bank overdraft 20,000 22,500 46,260 Non-current liability Loan 90,000 120,000 Financed by: Stated capital 37,500 31.240 Net profit 60,000 90,000 97,500 121,240 Total equity and liabilities 210,000 287,500 Additional information • A motor vehicle which had cost GHC45,000 with a written down value of GHC15,000 had been sold for GHC 19,160. Required: Prepare the Statement of Cash-flow for Boakye Limited for the year ended December 31, 2021.

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

Chapter5: The Income Statement And The Statement Of Cash Flows

Section: Chapter Questions

Problem 5E: Multiple-Step and Single-Step In coin Statements The following items were derived from Gold...

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(Appendix 8.1) Inventory Write-Down Frost Companys inventory records tor the years 2019 and 2020 reveal the cost and market of the January 1, 2019, inventory to be 125,000. On December 31, 2019, the cost of inventory was 130,000, while the market value was only 128,000. The December 31, 2020, market value of inventory was 140,000, and the cost was only 135,000. Frost uses a periodic inventory system. Purchases for 2019 were 100,000 and for 2020 were 110,000. Required: 1. Assume the inventory that existed at the end of 2019 was sold in 2020. Prepare the journal entries at the end of 2019 and 2020 to record the lower of cost or net realizable value under the (a) allowance method and (b) direct method. 2. Prepare the cost of goods sold section of the income statement and show how the company would record the inventory on its balance sheet for 2019 and 2020 under the (a) allowance method and (b) direct method. 3. Next Level Refer to your answer for P8-3. How does the use of a periodic inventory system versus a perpetual inventory system affect the valuation of inventory and the amount reported as income?
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(Appendix 8.1) Inventory Write-Down The inventories of Berry Company for the years 2019 and 2020 are as follows: Berry uses the periodic inventory method and the FIFO inventory cost flow assumption. Required: 1. Assume the inventory that existed at the end of 2019 was sold in 2020. Prepare the necessary journal entries at the end of each year to record the correct inventory valuation if Berry uses the: a. direct method b. allowance method 2. Next Level Refer to your answer for E8-6. How does the use of a periodic or perpetual inventory system affect the valuation of inventory?
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QUESTION 1The following are extracts of the income statement and the statement of financial position forMorula Industries.STATEMENT OF INCOME FOR THE YEAR ENDED 31 DECEMBER 2019PulaSales 500,000Less Cost of sales:Opening inventory 120,000Purchases 415,000Cost of goods available for sale 535,000Closing inventory (115,000) (420,000)Gross profit 80,000Operating expenses (40,000)Net surplus for the year 40,000 STAMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2019PulaCurrent assetsInventory 115,000Receivables 133,000Bank overdraft 124,000Current LiabilitiesPayables 96,000Capital and reservesShare capital 70,000General reserve 110,000Retained profit 110,000Additional Information The receivables and payables opening balances were P50, 000 each. All sales and purchases were made on credit.Required:a. Calculate the:i. Average payment period. ii. Average age of inventory. iii. Average collection period. iv. Cash conversion cycle. b. Explain five strategies that can improve the cash conversion…
5. During 2020 an entity decided to change from the FIFO method of inventory valuation to the weighted averagemethod. Inventory balances under each method were: FIFO Weighted AverageDecember 31, 2017 4,500,000 5,400,000December 31, 2018 7,800,000 7,100,000December 31, 2019 8,300,000 7,800,000The income tax rate is 30%. What amount should be reported as the effect of this accounting change in thestatement of retained earnings for 2020?a. 350,000 decrease c. 490,000 decreaseb. 350,000 increase d. 490,000 increase
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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 %