Boone Hardware Store completed the following merchandising transactions in the month of May. At the beginning of May, the ledger of Boone showed Cash of $5,000 and Owner’s Capital of $5,000.
May 1 Purchased merchandise on account from Adewale’s Wholesale Supply $4,200, terms 2/10, n/30.
2 Sold merchandise on account $2,100, terms 1/10, n/30. The cost of the merchandise sold was $1,300.
5 Received credit from Adewale’s Wholesale Supply for merchandise returned $300.
9 Received collections in full, less discounts, from customers billed on sales of $2,100 on
May 2.
10 Paid Adewale’s Wholesale Supply in full, less discount.
11 Purchased supplies for cash $400.
12 Purchased merchandise for cash $1,400.
15 Received refund for poor quality merchandise from supplier on cash purchase $150.
17 Purchased merchandise from Agbaje Distributors $1,300, FOB shipping point, terms 2/10, n/30.
19 Paid freight on May 17 purchase $130.
24 Sold merchandise for cash $3,200. The merchandise sold had a cost of $2,000.
25 Purchased merchandise from Somerhalder, Inc. $620, FOB destination, terms 2/10, n/30.
27 Paid Agbaje Distributors in full, less discount.
29 Made refunds to cash customers for defective merchandise $70. The returned merchandise had a fair value of $30.
31 Sold merchandise on account $1,000 terms n/30. The cost of the merchandise sold was $560.
Boone Hardware’s chart of accounts includes the following: No. 101 Cash, No. 112 Accounts Receivable, No. 120 Inventory, No. 126 Supplies, No. 201 Accounts Payable, No. 301 Owner’s Capital, No. 401 Sales Revenue, No. 412 Sales Returns and Allowances, No. 414 Sales Discounts, and No. 505 Cost of Goods Sold.
Instructions
(a) Journalize the transactions using a perpetual inventory system.
(b) Enter the beginning cash and capital balances and post the transactions. (Use J1 for the journal reference.)
(c) Prepare an income statement through gross profit for the month of May 2012.
You are required to choose a suitable company with sufficient disclosures on inventory and write a business report to address the following two questions. You may choose the company from: http://www.marketindex.com.au/asx200.
By reference to the annual report of your selected company, you are required to address the following two aspects in the business report:
- (1) Review the inventory disclosure of your selected company. (Hints: your review may include the following components: -inventory system (perpetual or periodic);
-cost assumption (FIFO, LIFO or average cost);
-the impact of cost assumption to the statement of profit and loss and
-evaluation of inventory, etc.)
- (2) You are required to conduct research (i. e. reviewing relevant accounting standards and
policies as well as academic and professional journals), and discuss regulatory requirements and various factors that accountants should consider when setting up accounting policy relating to inventory for the entities they work for?
You are required to choose a suitable company with sufficient disclosures on inventory and write a business report to address the following two questions. You may choose the company from: http://www.marketindex.com.au/asx200.
By reference to the annual report of your selected company, you are required to address the following two aspects in the business report:
- Review the inventory disclosure of your selected company. (Hints: your review may include the following components: -inventory system (perpetual or periodic);
-cost assumption (FIFO, LIFO or average cost);
-the impact of cost assumption to the statement of profit and loss and
-evaluation of inventory, etc.)
The Design hill Company uses a normal job-costing system at its Melbourne plant. The plant has a machining department and an assembly department. Its job-costing system has two direct-cost categories (direct materials and direct manufacturing labour) and two manufacturing overhead cost pools (the machining department with machine hours as the allocation base, and the assembly department with direct manufacturing labour costs as the allocation base). The 2020 budget for the plant were as follows: Machining Department Assembly Department Manufacturing overhead $1,800,000 $3,600,000 Direct manufacturing labour costs $1,400,000 $2,000,000 Direct manufacturing labour-hours 100,000 200,000 Machine-hours 50,000 220,000 Required: 1) What is the estimated overhead rate that should be used in the: a. Machining Department (2 mark) b. Assembly Department (2 mark) 2) The job-cost record for Job F49 contained the following: Machining Department Assembly Department Direct materials used $45,000 $70,000 Direct manufacturing labour costs $14,000 $15,000 Direct manufacturing labour-hours 1,000 1,500 Machine-hours 2,000 1,000 a) Compute the total manufacturing overhead costs allocated to Job F49. (3 marks) b) Assuming that Job F49 manufactured 200 units of product, calculate the per-unit total manufacturing cost for Job F49.
In its December 31, 2018 balance sheet, what amount should looney report as payable for consigned goods?
This assessment is designed to allow students to identify relevant sources for their research and undertake review on a theoretical concepts/constructs that has real world business implications. This assessment relates to Learning Outcomes a, b and d
This article collections and structured review set a basis for literature review section of Research Proposal in Assessment 4.
Following consultation with the lecturer or tutor, the students research the field to find four academic articles relating to the research topic as proposed in Assessment 2. The articles must be from 2010 onwards, and all articles must be full papers (not research note or book reviews) sourced from refereed academic journals.
Note: Other than in exceptional circumstances, Assessment
The accountant of Lisbon is considering a number of transactions and events and how they should be treated in accordance with the concepts and qualitative characteristics of financial information as set out in the Conceptual Framework. During the year ended 31 March 20X6, Lisbon experienced the following transactions or events. (i) Sold an asset to a finance company and leased it back for the remainder of its useful life. The accountant has decided that this should be treated as a secured loan. (ii) The company’s statement of profit or loss prepared using historical costs showed a loss from operating its shops, but the company is aware that the increase in the value of its properties during the period far outweighed the operating loss. (iii) Inventory has up to this year been valued using FIFO but the accountant is considering changing to the weighted average method for the year to 31 March 20X6.
REQUIRED
(A)The accountant is aware that some members of the Board of Lisbon have little understanding of accounting and he is worried about his presentation of the financial statements at the Board meeting. How should he deal with this situation? B) Which concept or qualitative characteristic has influenced the decision in (i) above) In looking at issue (ii) above, the accountant decides that the properties should be revalued. Which concept or qualitative characteristic has been applied in making this decision) In applying the principle of comparability, how should the change of inventory valuation basis be accounted for?
Villa dry’s inventory includes three items for which the following details are available. Supplier’s Net realizable list price value Shs. Shs. Product A 3,600 5,100Product B 2,900 2,800Product C 4,200 4,100
The company receives a 2½% trade discount from its suppliers and it also takes advantage of a 2% discount for prompt payment.
Required:(a) Calculate the total value of products A, B and C which should be shown in inventory in the statement of financial position.(b) Explain the difference that changing from a weighted average to FIFO method of inventory valuation is likely to have on an entity’s profit or loss.
Kumar and Sons” provided you following information on its inventory acquisitions 10 6 10 Beginning inventory as on 1s, Shrawan, 2072: 1, 775 units @ Rs. 12. Purchases: Shrawan 6: 12,000 units @ Rs.11 Bhadra 12 10,000 units @ Rs.10 Aswin 18: 11,000 units @ Rs.9.5 Kartik 24: 8,000 units @ Rs.9 Mangsir 30: 9,000 units @ Rs.8 On Mangsir 30, the company had 3,000 units in hand. The company’s operating and selling expenses was Rs.80,000 The corporate tax rate is 25%. Required: a. Calculate cost of goods sold and cost of inventory under following inventory valuation method& i. FIFO ii. LIFO iii. Weighted average. D. Which method do you recommend so that Kumar and Sons pays the least amount of tax? Explain your answer.
At the beginning of the current golf season, on April 1, 2018, the general ledger of In the Pines Golf Shop showed Cash $4,200; Inventory $19,500; Common Shares $12,000; and Retained Earnings $11,700. In the Pines Golf Shop uses a perpetual inventory system.
Name the type of control activity (5 exist in total) that is being used in each of the following examples. (4
marks, 1 mark each)
[4.00 marks]
a) ABC Coy Pty Ltd stores inventory that is in a room that is monitored by cameras.
b) An internal auditor reconciles the bank statement each month
c) The employee who makes EFT payments is not permitted to make entries in the general ledger (T
accounts).
d) A pre numbered shipping document is used for each shipment to customers.
1. Prepare the balance sheets of Parent Ltd and the consolidated balance sheet as at 1 January 20X7 after each transaction, using for each question the balance sheets of Parent Ltd and Daughter Ltd as at 1 January 20X7 which were as follows:
Parent Ltd Daughter Ltd
£ £
Ordinary shares of £1 each 40,500 9,000
Retained earnings 4,500 1,800
45,000 10,800
Cash 20,000 2,000
Other net assets 25,000 8,800
45,000 10,800
(a) Assume that on 1 January 20X7 Parent Ltd acquired all the ordinary shares in Daughter Ltd for £10,800 cash. The fair value of the net assets in Daughter Ltd was their book value.
(b) The purchase consideration was satisfied by the issue of 5,400 new ordinary shares in Parent Ltd. The fair value of a £1 ordinary share in Parent Ltd was £2. The fair value of the net assets in Daughter Ltd was their book value.
Question 2
(a) On 1 January 20X7 Parent Ltd acquired all the ordinary shares in Daughter Ltd for £16,200 cash. The fair value of the net assets in Daughter Ltd was their book value.
(b) The purchase consideration was satisfied by the issue of 5,400 new ordinary shares in Parent Ltd. The fair value of a £1 ordinary share in Parent Ltd was £3. The fair value of the net assets in Daughter Ltd was their book value.