Info
Warning
Danger

Accounting Expert Answers, Study Resources & Learning Aids

The vast field of accounting contributes to one of the largest subjects in our study resources. Accounting flashcards, homework answers for textbooks & other learning aids can increase your competency in this domain instantly. Become a top student with our support. Search Now…

Ask an Expert

Our Experts can answer your tough homework and study questions.

Answers in as fast as 15 minutes
Post a Question
12.A company’s liquidation of inventory under LIFO results in higher income during periods of rising costs. Therefore, managementcan manipulate earnings by delaying purchases until after the end of the fiscal year. a. True b. False 13.The use of dollar-value LIFO follows the same methodology as the LIFO method but reduces the record keeping. a. True b. False 14.The use of.
14 Views
View Answer
105.Cabinets for Less uses FIFO for internal reporting purposes and LIFO for financial and income tax purposes. At the end of 2016, the following information was obtained from the inventory records: 2015 2016 Ending inventory, FIFO $78,650 $93,250 Ending inventory, LIFO 68,500 78,350   Required:Prepare the necessary entry to convert to LIFO at the end of 2016. 106.Richardson’s Flower Depot uses.
5 Views
View Answer
125.The Boise Tractor Company hired a new auditor DeBruins& Co. Upon review of their accounting records DeBruins made some suggestions regarding the information classified in the single account titled Accounts Receivable. The auditors found the following: ? Accounts Receivable (trade) $ 78,875 Advances to Employees 2,475 Deposit to guarantee performance 19,000 Utility Deposit 750 Notes Receivable (trade) due in 2.
9 Views
View Answer
107.Given the following information for the Lawrence Company: ? ? ? NRV Minus Net ? ? ? Normal Realizable Replacement Item Cost Profit Value Cost a $ 3.40 $ 2.79 $ 4.14 $ 4.65 b 36.00 28.80 32.40 27.60 c 2.40 1.32 1.56 1.94 d 6.00 5.55 6.15 6.30 e 24.00 20.40 22.80 21.00 f 13.35 10.55 12.30 12.90 Required:Determine the lower of cost or market for each inventory item. .
8 Views
View Answer
12.If a purchase on credit is omitted from the purchase account in error and ending inventory is correctly determined, net income for the period would be understated. a. True b. False 13.If ending inventory is overstated for the current period due to a costing error but purchases are correct, the balance sheet at the end.
9 Views
View Answer
82.The dollar-value LIFO retail method a. combinesthe principle of retail LIFO with dollar-value LIFO. b. does not really include retail LIFO in thecalculation process. c. is a new principle. d. is an interesting theoretical exercise that is rarely used in practice. 83.What is the effect on net income if a company fails to record a purchase in transit (FOB.
5 Views
View Answer
136.On December 31, the Jacob, Inc. general ledger contained the following balances prior to write-offs and adjustments: Trade Accounts Receivable $ 623,450 Allowance for Doubtful Accounts 15,800 (credit) Net Credit Sales 2,529,000 Before completing an aging analysis to determine the estimated amount uncollectible, Jacob decided to write off $7,500 of an account past due over 360 days.Aging of.
5 Views
View Answer
32.The major criticism of the lower of cost or market rule for valuation of inventory is that. a. holding losses are recognized, but holding gains are not. b. holding gains are recognized, but holding losses are not. c. the total difference between selling price and cost is usually recognized in the period of the sale. d. the conservatism.
13 Views
View Answer
133.The following information is provided: Unadjusted balance in Allowance for Doubtful Accounts $ 1,100 (debit) Accounts Receivable, December 31 245,500 Sales Returns and Allowances 5,500 Sales 850,000 Sales Discounts 15,000   Required: a. Prepare the adjusting entry if bad debts are estimated to be 1.5% of net sales. b. Compute the amount of the adjusting entry if bad debts are estimated to be 3% of ending accounts.
8 Views
View Answer
169.Under U.S. GAAP, a company can designate a receivable, upon initial recognition, to be recognized at fair value without meeting any criteria. IFRS has established qualifying criteria for fair value designation.Required:Describe the IFRS qualifying criteria that must be met to designate a receivable as fair value. .
7 Views
View Answer
88.Revolution Hardware reported $475,000 of inventory on December 31, 2016, based on a physical count.Additional information is as follows: ? Included in the 2016 physical count were machines billed to a customer FOB shipping point on December 31. These machines had a cost of $12,000 and had been billed at $30,000. The.
22 Views
View Answer
141.Prepare the journal entries for the following transactions: a. Sold $150,000 of goods to Georgia Co. on account. b. Collected $50,000 from Georgia Co. c. Accepted a $100,000, one-year, 10% note from Georgia Co. for the amount remaining on the account. d. After 60 days, discounted the note from Georgia Co. at First National Bank at a 12%.
9 Views
View Answer
92.The accountant for Lee Company made the following errors related to merchandise inventory in 2016: 1. The beginning inventory for 2016 was overstated by $750 due to an error in the physical count. 2. A $1,300 purchase of merchandise on credit was not recordedand was notincluded in the ending inventory. ? Assuming a periodic inventory system,.
6 Views
View Answer
101.Given the following information for Goode Company: May 1 Beginning inventory 18 units @ $4 per unit May 7 Purchase 12 units @ $5 per unit May 10 Sale 14 units May 17 Purchase 10 units @ $6 per unit May 19 Sale 4 units   Required:Answer the following questions for Goode Company: a. If FIFO is in use, what is the total ending inventory in dollars? b. If perpetual LIFO.
6 Views
View Answer
150.You are in the process of preparing a bank reconciliation for Charter Boat Company as of May 31. Listed below is information necessary to prepare the reconciliation.Required:In the spaces provided, place the appropriate letter to indicate whether each item of information should be a. deducted from the balance per bank statement b. added to.
7 Views
View Answer
71.Laura’s Department Store uses the average cost retail inventory method to determine its ending inventory. The accounting records for the current year for Laura’s contained the following information: Cost Retail Purchases $71,200 $87,750 Beginning inventory 17,000 23,500 Sales 98,000 Net markups 6,500 Net markdowns 3,000 ? In addition, the accounting records for Laura’s disclosed that purchases returns at cost and retail were $1,950 and $4,250, respectively..
8 Views
View Answer
62.Which one of the following sets of inventory cost flow assumptions is not susceptible to profit manipulation by management? a. FIFO and specific identification b. LIFO and average cost c. FIFO and average cost d. LIFO and specific identification 63.For the year in which prices rise, adoption of a "just-in-time" inventory system will most likely result in a. a permanent increase.
34 Views
View Answer
105.The following information for five products (A-E) was taken from the inventory records of the Walker Company: ? Product A B C D E # of Units 175 200 250 200 300 Unit cost $5.50 $10.00 $5.10 $5.10 $5.00 Replacement cost per unit $6.00 $9.00 $4.60 $4.50 $4.50 Net realizable value (NRV) per unit $5.20 $12.50 $7.00 $7.00 $7.00 NRV–Normal profit per unit $4.80 $10.30 $5.25 $4.00 $4.80 ? Required:Determine the valuation of the inventory at the lower of cost or market applied to: a. individual items b. the inventory as a whole .
5 Views
View Answer
152.Gordon Fish Co. prepares bank reconciliations that adjust to the correct balance of cash. You are given the following information: Outstanding checks $ 177 Note collected for Gordon by bank (a) ? Balance per bank statement 3,716 Bank service charges 27 Adjusted cash balance 3,731 Check written for $98 incorrectly recorded in books at $89; check cleared the bank (b) ? NSF check 82 Unadjusted book balance 3,299 Deposits in.
3 Views
View Answer
62.Barbara Co. presents the following information: Cost Retail Net markups $  785 Sales 2,850 Purchases $1,570 2,150 Net markdowns 50 Beginning inventory 300 350 The company uses the average cost retail inventory method. What is the cost of ending inventory? a. $233.55 b. $255.98 c. $275.80 d. $222.55 63.Which one of the following statements is false concerning the retail inventory method? a. Net markups and markdowns are always added and subtracted in order to compute the.
5 Views
View Answer
128.Lockern Co. records estimated future sales returns and allowances. Total sales amount to $1,550,000, and, in the past, sales returns and allowances have been 2 1/2% of sales. Required:Prepare journal entries to: a. Record the estimated sales returns and allowances. b. Record the return of $1,000 of defective furniture. 129.Movie Set Up Company’s trial balance before.
6 Views
View Answer
103.The information below is provided for Sea Company: Ending Inventory Price Year End-of-Year Prices Index 2014 $ 90,000 100 2015 97,650 105 2016 103,550 109 2017 109,760 112   Required: a. Compute Sea Company’s 2016 ending inventory using dollar-value LIFO. b. Explain why a company would want to use dollar-value LIFO. .
7 Views
View Answer
Exhibit 7-2 Edwards Co. purchased raw materials with a cost of $95,000 on March 2, 2015. Credit terms of 3/20, n/60 applied. 41.Refer to Exhibit 7-2. If Edwards uses the net method and pays for the purchase on March 18, 2015, what amount is recorded in the Purchase Discounts Taken account? a. $0 b. $2,850 c. $5,000 d. $3,000 42.Refer to.
66 Views
View Answer
52.As a result of taking a physical inventory count on December 31, 2016, the Mona Lisa Company inventory was determined to be $61,500. The auditors for Mona Lisa suspected an inventory shortage and used the gross profit method to estimate the ending inventory. The accounting records for the company contained.
11 Views
View Answer
121.One of the disadvantages of the LIFO cost flow assumption is the impact of the liquidation of LIFO layers.Required: a. Explain what is meant by inventory liquidation under the LIFO cost flow assumption. b. Discuss why this may be a serious problem for LIFO but not for FIFO. 122.Even though the LIFO cost flow assumption.
9 Views
View Answer
96.The following data has been provided by Lee Company regarding its inventory purchases and sales throughout the year. Transaction Units Cost per Unit 1-Jan Balance 175 $86 14-Mar Sale 55 23-May Purchase 135 90 21-Aug Sale 100 5-Nov Purchase 175 91 18-Nov Sale 100 30-Nov Sale 100 5-Dec Sale 100 10-Dec Purchase 25 95   Required:Compute the cost of goods sold and ending inventory using the perpetual inventory system for the FIFO cost flow assumption. 97.The following data has been provided by Lee Company regarding its inventory.
5 Views
View Answer
167.In certain circumstances a company may find it necessary to accelerate the cash inflows potentially generated from its accounts receivable. This can be accomplished through pledging, assigning, or factoring the accounts receivable. ? Required: ? Explain each of these threearrangements. Include in your discussion an explanation of each agreement, who retains the risks and.
9 Views
View Answer
165.A student in the accounting principles course comes to you, an upper-division accounting major, for an explanation of the difference between the gross price and net price methods of recording credit sales. The principles student wants to know why, if there is no difference in net income, a company would.
5 Views
View Answer
156.What is the difference between Trade Receivables and Nontrade Receivables? 157.?What are the basic issues related to the valuation of receivables? 158.How does GAAP require receivables to be recorded? What about trade receivables? 159.?What are the two methods for recording a sales transaction on account when a cash discount is involved? Under what.
5 Views
View Answer
117.What three difficulties does dollar-value LIFO overcome compared to applying simple LIFO? 118.What is the LIFO Valuation Allowance, also known as LIFO reserve? 119.There are many different methods available for costing inventory. Therefore, the decision on which method to select should involve some serious thought as to the consequences involved.Required: a. Discuss the objectives.
5 Views
View Answer
Exhibit 8-2The Dormer Company uses the gross profit method to estimate its inventory in interim financial statements. The markup on cost is 50%. The following information is available: January 1, 2016, inventory balance $12,500 Purchases 25,000 Sales during January 24,000 42.Refer to Exhibit 8-2. The estimated inventory at January 31, 2016, is a. $25,500 b. $21,500 c. $16,000 d. $12,000 43.Refer to Exhibit 8-2. The estimated.
21 Views
View Answer
1.The following relationship is only true for a merchandising firm: ? Beginning Inventory + Purchases (net) or Production costs for the period = Cost of Goods Available for Sale a. True b. False 2.The cost of goods sold model for a manufacturer is: Beginning Finished Goods Inventory + Purchases (net) = Cost of Goods Available for Sale - Ending Finished Goods Inventory = Cost of Goods Sold a. True b. False 3.A perpetual inventory system provides management.
25 Views
View Answer
1.Reporting inventory at the lower of cost or market provides a representationally faithful value of inventory; therefore, the application of the lower of cost or market rule is consistent with the materiality principle. a. True b. False 2.The Net Realizable Value is considered the ceiling that prevents inventory from being valued at amount higher than.
23 Views
View Answer
99.On November 1, Lacy Company began business with the purchase of 250 units of inventory for $21,625. During the month, Lacy had the following inventory transactions: Date November 6 Purchased 100 units @ $75 per unit 11 Sold 200 units 17 Sold 85 units 24 Purchased 100 units @ $125 per unit 28 Purchased 50 units @ $110 per unit 30 Sold 100.
5 Views
View Answer
Exhibit 7-3Davis Co. had the following inventory activity during April: ? ? Unit ? Units Cost Beginning inventory 100 $ 8 Purchase (April 3) 60 12 Sale (April 10) 80 ? Purchase (April 18) 50 15 Purchase (April 23) 80 18 Sale (April 28) 100 ? 52.Refer to Exhibit 7-3. Assuming Davis uses a periodic FIFO cost flow assumption, ending inventory at April 30 would be a. $880 b. $920 c. $1,090 d. $1,890 53.Refer to Exhibit 7-3. Assuming Davis uses a periodic LIFO.
31 Views
View Answer

Can't find what you're looking for ?

Ask our exprts a study questions, on us.
Get free Homework Help*