ADVANCED FINANCIAL ACCOUNTING IA
12th Edition
ISBN: 9781260545081
Author: Christensen
Publisher: MCG
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Chapter 13, Problem 13.3.8E
To determine
Concept Introduction:
Interim financial reporting is reporting of financial statements like Income Statement and
To select: The correct option for inventory value in interim financial reporting.
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An analyst observes a decrease in a company’s inventory turnover. Which of the following would most likely explain this trend? B . Due to problems with obsolescent inventory last year, the company wrote off a large amount of its inventory at the beginning of the period.
Wilma Company experienced a P500,000 decline in the market value of inventory at the end of the first quarter. The entity had expected this decline to reverse in the second quarter, and in fact, the second quarter recovery exceeded the previous decline by P100,000.
What amount of gain or loss should be reported in the interim statements for the first and second quarters?
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Choices:
First quarter Second quarter
a. 500,000 loss. 500,000 gain
b. 500,000 loss 600,000 gain
c. 500,000 loss 100,000 gain
d. 0 0
1. If the inventory account at the end of the year is understated, the effect will be to
a.overstate the gross profit on sales.
b.understate the net purchases.
c. overstate the cost of goods sold.
d.overstate the goods available for sale
2. Which one among the following statements is not a characteristic of the integral view of presenting interim financial statements?
a.It is the more acceptable view.
b.Each interim period is recognized as a separate accounting period, regardless of the length of time involved.
c. Each interim period is a part of the annual period.
d.The revenues and expenses for the annual period are allocated among interim periods
3. What is correct concerning the 75% overall size test for operating segments?
a. The total external and internal revenue of all reportable segments is 75% or more of the entity’s external revenue.
b. The total external revenue of all reportable segments is 75% or more of the entity’s external and internal revenue.
c. The total external…
Chapter 13 Solutions
ADVANCED FINANCIAL ACCOUNTING IA
Ch. 13 - Prob. 13.1QCh. 13 - Prob. 13.2QCh. 13 - What are the three 10 percent significance tests...Ch. 13 - Prob. 13.4QCh. 13 - A company has 10 industry segments, of which the...Ch. 13 - Prob. 13.6QCh. 13 - Prob. 13.7QCh. 13 - Prob. 13.8QCh. 13 - Prob. 13.9QCh. 13 - Prob. 13.10Q
Ch. 13 - Prob. 13.11QCh. 13 - Prob. 13.12QCh. 13 - Prob. 13.13QCh. 13 - Prob. 13.14QCh. 13 - Maness Company made a change in accounting for its...Ch. 13 - Prob. 13.1CCh. 13 - Prob. 13.2CCh. 13 - Prob. 13.3CCh. 13 - Prob. 13.7CCh. 13 - Prob. 13.8CCh. 13 - Prob. 13.9CCh. 13 - Reportable Segments Data for the seven operating...Ch. 13 - Prob. 13.2.1ECh. 13 - Prob. 13.2.2ECh. 13 - Prob. 13.2.3ECh. 13 - Prob. 13.2.4ECh. 13 - Prob. 13.2.5ECh. 13 - Prob. 13.2.6ECh. 13 - Prob. 13.2.7ECh. 13 - Prob. 13.2.8ECh. 13 - Prob. 13.2.9ECh. 13 - Prob. 13.2.10ECh. 13 - Prob. 13.2.11ECh. 13 - Prob. 13.3.1ECh. 13 - Prob. 13.3.2ECh. 13 - Multiple-Choice Questions on Interim Reporting...Ch. 13 - Prob. 13.3.4ECh. 13 - Prob. 13.3.5ECh. 13 - Prob. 13.3.6ECh. 13 - Prob. 13.3.7ECh. 13 - Prob. 13.3.8ECh. 13 - Prob. 13.3.9ECh. 13 - Prob. 13.3.10ECh. 13 - LIFO Liquidation During July, Laesch Company,...Ch. 13 - Inventory Write-Down and Recovery Cub Company, a...Ch. 13 - MutiniedChoice Questions on Income Taxes at...Ch. 13 - Prob. 13.6.2ECh. 13 - Prob. 13.6.3ECh. 13 - MutiniedChoice Questions on Income Taxes at...Ch. 13 - Prob. 13.6.5ECh. 13 - Prob. 13.6.6ECh. 13 - Prob. 13.7ECh. 13 - Prob. 13.8ECh. 13 - Prob. 13.9ECh. 13 - Prob. 13.10ECh. 13 - Prob. 13.11ECh. 13 - Prob. 13.12ECh. 13 - Prob. 13.13PCh. 13 - Prob. 13.14PCh. 13 - Interim Income Statement Chris Inc. has...Ch. 13 - Prob. 13.17PCh. 13 - Prob. 13.20PCh. 13 - Matching Terms Match the items in the left-hand...
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- When analyzing financial statements, what can you conclude when the inventory turnover ratio increases from 4.0 to 6.0 over a three year period. Group of answer choices a. The day’s inventory held are within the typical industry average b. The day’s inventory held has increased over time None of the above c. The day’s inventory held has decreased over timearrow_forwardWhat is the effect of a $40000 overstatement of last year's inventory on current years ending retained earning balance? Overstated by $40000. Need more information to determine. Understated by $40000. No effect.arrow_forwardFor each of the following independent scenarios, indicate the effect of the error (if any) on: i. 2019 net income; ii. 2020 net income; and iii. 2020 closing retained earnings. company uses the periodic system of inventory and its fiscal year-end is December 31. Ignore income tax effects. Consider each of the following independent The scenarios: a. Your analysis of inventory indicates that inventory at the end of 2019 was overstated by $27,000 due to an inventory count error. Inventory at the end of 20 13 was correctly stated. b. Invoices in the amount of $107,000 for inventory received in December 2019 were not entered on the books in 2019. They were recorded as purchases in January 2020 when they were paid. The goods were counted in the 2019 inventory count and included in ending inventory on the 2019 financial statements. c. Goods received on consignment amounting to $89,000 were included in the physical count of goods at the end of 2020 and included in ending inventory on the 2020…arrow_forward
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