The records of Pelletier Inc. show the following data for the years ended July 31: Income statement: Sales Cost of goods sold Operating expenses Statement of financial position: Inventory 2018 2017 2016 $320,000 $312,000 $300,000 187,000 203,000 170,000 52,000 52,000 50,000 37,000 24,000 37,000 After the company's July 31, 2018, year-end, the controller discovers two errors: 1. Ending inventory at the end of 2016 was actually $27,000, not $37,000. Pelletier included goods held on consignment for another company that were mistakenly included in the 2016 inventory account. As a result, the company's inventory count showed the company having more inventory than its accounting records indicated it should have. The company adjusted

The records of Pelletier Inc. show the following data for the years ended July 31: Income statement: Sales Cost of goods sold Operating expenses Statement of financial position: Inventory 2018 2017 2016 $320,000 $312,000 $300,000 187,000 203,000 170,000 52,000 52,000 50,000 37,000 24,000 37,000 After the company's July 31, 2018, year-end, the controller discovers two errors: 1. Ending inventory at the end of 2016 was actually $27,000, not $37,000. Pelletier included goods held on consignment for another company that were mistakenly included in the 2016 inventory account. As a result, the company's inventory count showed the company having more inventory than its accounting records indicated it should have. The company adjusted

Century 21 Accounting General Journal

11th Edition

ISBN:9781337680059

Author:Gilbertson

Publisher:Gilbertson

Chapter20: Accounting For Inventory

Section: Chapter Questions

Problem 3AP

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On January 1, Pope Enterprises inventory was 625,000. Pope made 950,000 of net purchases during the year. On its year-end income statement, Pope reported cost of goods sold of 1,025,000. Calculate Popes December 31 ending inventory.
Reid Company uses the periodic inventory system. On January 1, it had an inventory balance of 250,000. During the year, it made 613,000 of net purchases. At the end of the year, a physical inventory showed it had ending inventory of 140,000. Calculate Reid Companys cost of goods sold for the year.
Refer to RE22-2. Assume Heller Company had sales revenue of 510,000 in 2019 and 650,000 in 2020. Prepare Hellers partial income statements (through gross profit) for 2019 and 2020. RE22-2 Heller Company began operations in 2019 and used the LIFO method to compute its 300,000 cost of goods sold for that year. At the beginning of 2020, Heller changed to the FIFO method. Heller determined that its cost of goods sold under FIFO would have been 250,000 in 2019. For 2020, Hellers cost of goods sold under FIFO was 360,000, while it would have been 410,000 under LIFO. Heller is subject to a 21% income tax rate. Compute the cumulative effect of the retrospective adjustment on prior years income (net of taxes) that Heller would report on its retained earnings statement for 2020.
Last year, Nikkola Company had net sales of 2,299,500,000 and cost of goods sold of 1,755,000,000. Nikkola had the following balances: Refer to the information for Nikkola Company above. Required: Note: Round answers to one decimal place. 1. Calculate the average inventory. 2. Calculate the inventory turnover ratio. 3. Calculate the inventory turnover in days. 4. CONCEPTUAL CONNECTION Based on these ratios, does Nikkola appear to be performing well or poorly?
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