RubyCpaMba- Wiley Plus Brief Exercise 6 –Accounting 100
LBM2014
brief_exercise_6.docxWiley Plus Brief Exercise 6 –Accounting 100
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Brief Exercise 6-1 |
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Brief Exercise 6-1 |
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Farley Company identifies the following items for possible inclusion in the taking of a physical inventory. Indicate whether each item should be "Included" or "Not Included" from the inventory taking.
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(a) |
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Goods shipped on consignment by Farley to another company. |
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(b) |
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Goods in transit from a supplier shipped FOB destination. |
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(c) |
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Goods sold but being held for customer pickup. |
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(d) |
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Goods held on consignment from another company. |
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Brief Exercise 6-2 |
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Wilbur Company has the following items: Indicate whether each item should be "Included" or "Not Included" from the inventory taking.
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(a) |
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Freight-In |
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(b) |
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Purchase Returns and Allowances |
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(c) |
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Purchases |
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(d) |
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Sales Discounts |
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(e) |
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Purchase Discounts |
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Brief Exercise 6-8 |
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Pettit Company reports net income of $90,000 in 2014. However, ending inventory was understated $7,000. What is the correct net income for 2014?
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The correct net income for 2014 |
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$ |
Warning
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Don't show me this message again for the assignment |
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Click if you would like to Show Work for this question: |
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Exercise 6-1 |
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Tri-State Bank and Trust is considering giving Josef Company a loan. Before doing so, management decides that further discussions with Josef’s accountant may be desirable. One area of particular concern is the inventory account, which has a year-end balance of $297,000. Discussions with the accountant reveal the following.
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1. |
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Josef sold goods costing $38,000 to Sorci Company, FOB shipping point, on December 28. The goods are not expected to arrive at Sorci until January 12. The goods were not included in the physical inventory because they were not in the warehouse. |
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The physical count of the inventory did not include goods costing $95,000 that were shipped to Josef FOB destination on December 27 and were still in transit at year-end. |
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Josef received goods costing $22,000 on January 2. The goods were shipped FOB shipping point on December 26 by Solita Co. The goods were not included in the physical count. |
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Josef sold goods costing $35,000 to Natali Co., FOB destination, on December 30. The goods were received at Natali on January 8. They were not included in Josef's physical inventory. |
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Josef received goods costing $44,000 on January 2 that were shipped FOB destination on December 29. The shipment was a rush order that was supposed to arrive December 31. This purchase was included in the ending inventory of $297,000. |
Determine the correct inventory amount on December 31.
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The correct inventory amount |
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$ |
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Exercise 6-9 |
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Optix Camera Shop uses the lower-of-cost-or-market basis for its inventory. The following data are available at December 31.
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Item |
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Units |
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Unit Cost |
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Market |
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Cameras: |
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Minolta |
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5 |
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$170 |
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$156 |
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Canon |
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6 |
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150 |
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152 |
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Light meters: |
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Vivitar |
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12 |
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125 |
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115 |
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Kodak |
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14 |
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120 |
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135 |
Determine the amount of the ending inventory by applying the lower-of-cost-or-market basis.
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The ending inventory |
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$ |
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Exercise 6-7 |
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Lisa Company had 100 units in beginning inventory at a total cost of $10,000. The company purchased 200 units at a total cost of $26,000. At the end of the year, Lisa had 80 units in ending inventory. (a) Compute the cost of the ending inventory and the cost of goods sold under FIFO, LIFO, and average-cost. (Round average-cost per unit and final answers to 0 decimal places, e.g. 1,250.)
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FIFO |
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LIFO |
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Average-cost |
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The cost of the ending inventory |
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$ |
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$ |
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$ |
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The cost of goods sold |
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$ |
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$ |
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$ |
