Acc 290 wiley week 5 BE5-1, 5-2, 6-5, 6-7,7-4,7-6
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acc_290_wiley_week_5_be_5-15-26-77-47-6_question.xlsxBE5-1
| BE5-1 | |||||
| Presented here are the components in Pedersen Company's income statement. Determine the missing amounts. | |||||
| Sales | Cost of Goods Sold | Gross Profit | Operating Expenses | Net Income | |
| $71,200 | $30,000 | $10,800 | |||
| $108,000 | $70,000 | $29,500 | |||
| $71,900 | $109,600 | $46,200 | |||
BE5-2
| BE5-2 | ||
| Prior Company | ||
| Account/Description | Debit | Credit |
| Wood Company | ||
| Account/Description | Debit | Credit |
| (To record the sale) | ||
| (To record the cost of inventory) |
Prior Company buys merchandise on account from Wood Company. The selling price of the goods is $900 and the cost of goods is $630. Both companies use perpetual inventory systems. Journalize the transactions on the books of both companies.
BE6-5
| BE6-5 |
In its first month of operation, Maze Company purchased 100 units of inventory for $6, then 200 units for $7, and finally 150 units for $8. At the end of the month, 180 units remained. Compute the amount of phantom profit that would result if the company used FIFO rather than LIFO. The company uses the periodic method. Phantom Profit $
BE6-7
| BE6-7 | |||
| O'Connor Video Center accumulates the following cost and market data at December 31. | |||
| Inventory Categories | Cost Data | Market Data | |
| Cameras | 12,500 | 13,400 | |
| Camcorders | 9,000 | 9,500 | |
| DVD's | 13,000 | 12,800 | |
| Compute the lower of cost or market valuation for O'Connor's inventory. | |||
BE7-4 and BE7-6
| BE7-4 | |
| Beaty Company has the following internal control procedures over cash receipts. Match the internal control principle that is applicable to each procedure. | |
| Establishment of responsibility | |
| Segregation of duties | |
| Independent internal verification | |
| Human resource controls | |
| Physical controls | |
| 1. Only the treasurer or assistant treasurer may sign checks | |
| 2. Company checks are prenumbered. | |
| 3. Check signers are not allowed to record cash disbursement transactions. | |
| 4. The bank statement is reconciled monthly by an internal auditor. | |
| 5. Blank checks are stored in a safe in the treasurer's office. | |
| BE7-6 | |
| Newell Company has the following internal control procedures over cash disbursements. Match the internal control principle that is applicable to each procedure. | |
| Segregation of duties | |
| Establishment of responsibility | |
| Physical controls | |
| Independent internal verification | |
| Documentation procedures | |
| 1. Only the treasurer or assistant treasurer may sign checks. | |
| 2. Company checks are prenumbered. | |
| 3. Check signers are not allowed to record cash disbursement transactions. | |
| 4. The bank statement is reconciled monthly by an internal auditor. | |
| 5. Blank checks are stored in a safe in the treasurer's office. |
