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ACC 308 Final Project: Notes to Financial Statements
ACC308
SNHU
April 3,2022
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Depreciation
The straight-line method is considered to be one of the great methods to calculate the
Peyton Approved equipment’s depreciation. According to research, the straight-line method
is known as the easiest method for calculation. It is basically calculated by distributing the
depreciation equally over the asset's life, and very few errors occur as a result (Bragg, 2022).
Here, the company should use the new location with the same methods to make sure that the
management, shareholders and investors can compare the equipment depreciation evenly
across different areas. It has been found that the Peyton company’s depreciation will remain
at approximately $2143.00 as per the Pro Forma Balance Sheets and the Pro Forma Income
Statement.
Supplies
In general, a company use supply management to enhance the performance of the
organisation. This kind of management follows some processes like acquiring, identifying,
and managing resources. Here the suppliers are required in the organisation to operate
everything. With the support of supply management, a company can able to continue its
operating systems and grow at a faster pace. Basically, this management includes the
purchase of services, information, physical goods, and other important resources to enhance
the performance of the company. However, there are specific goals of supply management
that help the company to grow in their best ways. This goal includes the efficient allocation of
resources, cost control, the effective collection of information, and risk management
associated with business decisions. Moreover, supply management is considered a systematic
business process that includes the coordination of the inventory management, and pre-
production logistics, with the support of employees, budgeting, and other important
information to run the business smoothly (Kenton, 2021). It has been found that Peyton
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company's total supplies are presently $27,986.00. However, it is important for the Peyton
company to ensure that they have a proper understanding of the end products, raw materials
and costs so that they can ensure no risk or no errors will occur at the time of managing the
supplies.
Inventory
The LIFO method is used by the Peyton company. This method is considered the last
in first out method. Based on the product, this method could not be the best method for the
company to use. The company need to give focus on the first-in, first-out method to utilise it
in some products. If looking into the merchandise inventory, the company has $229.00
inventory presently. The company need to look at other company to learn other ways to
reduce the overall costs like manufacturing costs, inventory costs, and merchandise costs with
the suppliers. However, it will be very helpful for the company to enhance the supply forecast
as well as it will help to avoid shortages. Moreover, Peyton company need to review their
inventory reports from their original location to the new location, which can help the
company to handle their inventory effectively.
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References
Bragg, S. (2022, March 10). Straight line depreciation definition. AccountingTools.
Retrieved April 5, 2022, from
https://www.accountingtools.com/articles/2017/5/15/straight-line-depreciation
Kenton, W. (2021, October 11). Supply management: An overview. Investopedia. Retrieved
April 5, 2022, from https://www.investopedia.com/terms/s/supplymanagement.asp
