FINANCIAL ACCT.:TOOLS...(LL)-W/ACCESS
8th Edition
ISBN: 9781119250913
Author: Kimmel
Publisher: WILEY
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Chapter 5, Problem 5.8AP
(a)
To determine
Gross profit rate is the financial ratio that shows the relationship between the gross profit and net sales. Gross profit is the difference between the total revenues and cost of goods sold. It is calculated by using the following formula:
Profit margin measures the amount of net income earned from each dollar of sales revenue generated by a company. Thus, it shows the relationship between the net income, and net sales. It is calculated by using the following formula:
To Find: The missing amount of cost of goods sold for 2016.
(b)
To determine
To Compute: The gross profit rate and profit margin for each fiscal year.
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Alpha company is a trading company that purchases and sales fruits and vegetables. During the year 2020, the company shows the following transactions and events:
Net profit is computed by subtracting operating expenses from the cost of goods sold.
The accountant records merchandise inventory (stock) in the expenses section of the income statement.
The company assumes that physical inventory is not important as it uses the perpetual inventory system during the year.
The driver of the company has access to the inventory, he delivers the merchandise, receives the cash and has access to the company
Required:
For each case, identify the anomaly and propose the correct accounting treatment/answer:
Alpha company is a trading company that purchases and sales fruits and vegetables. During the year 2020, the company shows the following transactions and events:
7) Net profit is computed by subtracting operating expenses from the cost of goods sold.
8) The accountant records merchandise inventory (stock) in the expenses section of the income statement.
9) The company assumes that physical inventory is not important as it uses the perpetual inventory system during the year.
10) The driver of the company has access to the inventory, he delivers the merchandise, receives the cash and has access to the company books.
Required:
For each case, identify the anomaly and propose the correct accounting treatment/answer:
NEBRASKA Co. has two merchandise outlets, its main store in Anchorage and its Fairbanks branch. For control purposes, all purchases are made by Anchorage main store and shipped to Fairbanks branch at cost plus 10%. On January 1, 2018, the inventories in Anchorage and Fairbanks are $1,360 and $396, respectively. During 2018, Anchorage purchased merchandise costing $4,000 and shipped 40% of it to the branch. At Year Ended 2018, the following journal entry to prepare the books for the next accounting period was prepared:
Sales
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484
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480
What is the amount of overvaluation that was realized from the branch sales?
Chapter 5 Solutions
FINANCIAL ACCT.:TOOLS...(LL)-W/ACCESS
Ch. 5 - Prob. 1QCh. 5 - Prob. 2QCh. 5 - Prob. 3QCh. 5 - Prob. 4QCh. 5 - Waymon Co. has net sales of 100,000, cost of goods...Ch. 5 - Masie Ascot believes revenues from credit sales...Ch. 5 - (a) What is the primary source document for...Ch. 5 - Prob. 8QCh. 5 - As the end of Smyle Companys fiscal year...Ch. 5 - To encourage bookstores to buy a broader range of...
Ch. 5 - Goods costing 1,900 are purchased on account on...Ch. 5 - Prob. 12QCh. 5 - Prob. 13QCh. 5 - Prob. 14QCh. 5 - Prob. 15QCh. 5 - Prob. 16QCh. 5 - Prob. 17QCh. 5 - What merchandising account(s) will appear in the...Ch. 5 - What types of businesses are most likely to use a...Ch. 5 - Prob. 20QCh. 5 - In the following cases, use a periodic inventory...Ch. 5 - Prob. 22QCh. 5 - What factors affect a companys gross profit...Ch. 5 - Prob. 24QCh. 5 - Prob. 25QCh. 5 - On July 15, a company purchases on account goods...Ch. 5 - Presented here are the components in Salas...Ch. 5 - Prob. 5.2BECh. 5 - Prob. 5.3BECh. 5 - Prob. 5.4BECh. 5 - Prob. 5.5BECh. 5 - Explain where each of these items would appear on...Ch. 5 - Prob. 5.7BECh. 5 - Prob. 5.8BECh. 5 - Prob. 5.9BECh. 5 - Prob. 5.10BECh. 5 - Prob. 5.11BECh. 5 - Prob. 5.12BECh. 5 - Prob. 5.13BECh. 5 - Prob. 5.14BECh. 5 - Prob. 5.1DIECh. 5 - Prob. 5.2DIECh. 5 - Prob. 5.3DIECh. 5 - Prob. 5.4DIECh. 5 - Prob. 5.5DIECh. 5 - Prob. 5.6DIECh. 5 - Prob. 5.1ECh. 5 - Assume that on September 1, Office Depot had an...Ch. 5 - Prob. 5.3ECh. 5 - Prob. 5.4ECh. 5 - Prob. 5.5ECh. 5 - Prob. 5.6ECh. 5 - Prob. 5.7ECh. 5 - Prob. 5.8ECh. 5 - Prob. 5.9ECh. 5 - Prob. 5.10ECh. 5 - Prob. 5.11ECh. 5 - Prob. 5.12ECh. 5 - Prob. 5.13ECh. 5 - Prob. 5.14ECh. 5 - Prob. 5.15ECh. 5 - Prob. 5.1APCh. 5 - Prob. 5.2APCh. 5 - Prob. 5.3APCh. 5 - Prob. 5.4APCh. 5 - Prob. 5.5APCh. 5 - Prob. 5.6APCh. 5 - Prob. 5.7APCh. 5 - Prob. 5.8APCh. 5 - Prob. 5.9APCh. 5 - Prob. 5.1CACRCh. 5 - Prob. 5.2CACRCh. 5 - Prob. 5.1EYCTCh. 5 - Prob. 5.2EYCTCh. 5 - Prob. 5.3EYCTCh. 5 - Prob. 5.4EYCTCh. 5 - Prob. 5.6EYCTCh. 5 - Prob. 5.7EYCTCh. 5 - Prob. 5.8EYCTCh. 5 - Prob. 5.9EYCTCh. 5 - Explain the difference between the...Ch. 5 - For each of the following income statement line...Ch. 5 - Prob. 5.3IFRSCh. 5 - Prob. 5.4IFRS
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