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Home / Questions / Brief Exercise 7-1 Kraft Enterprises owns the following assets at December 31, 2014. Cash in...

Brief Exercise 7-1 Kraft Enterprises owns the following assets at December 31, 2014. Cash in...

Brief Exercise 7-1

Kraft Enterprises owns the following assets at December 31, 2014.

Cash in bank—savings account   68,000   Checking account balance   17,000
Cash on hand   9,300   Postdated checks   750
Cash refund due from IRS   31,400   Certificates of deposit (180-day)   90,000


What amount should be reported as cash?

Cash to be reported   $[removed]

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Brief Exercise 7-2

Restin Co. uses the gross method to record sales made on credit. On June 1, 2014, it made sales of $50,000 with terms 3/15, n/45. On June 12, 2014, Restin received full payment for the June 1 sale.

Prepare the required journal entries for Restin Co. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Date Account Titles and Explanation Debit Credit
June 1  [removed] [removed] [removed]
   [removed] [removed] [removed]
June 12  [removed] [removed] [removed]
   [removed] [removed] [removed]
   [removed] [removed] [removed]

Brief Exercise 8-2

Matlock Company uses a perpetual inventory system. Its beginning inventory consists of 50 units that cost $34 each. During June, (1) the company purchased 150 units at $34 each, (2) returned 6 units for credit, and (3) sold 125 units at $50 each.

Journalize the June transactions. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

No. Account Titles and Explanation Debit Credit
(1)  [removed] [removed] [removed]
   [removed] [removed] [removed]
(2)  [removed] [removed] [removed]
   [removed] [removed] [removed]
(3)  [removed] [removed] [removed]
   [removed] [removed] [removed]
  (To record sales)    
   [removed] [removed] [removed]
   [removed] [removed] [removed]
  (To record cost of goods sold)

Brief Exercise 8-5

Amsterdam Company uses a periodic inventory system. For April, when the company sold 600 units, the following information is available.

    Units   Unit Cost   Total Cost
April 1 inventory   250   $10     $ 2,500  
April 15 purchase   400   12     4,800  
April 23 purchase   350   13     4,550  
    1,000         $11,850  

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Calculate weighted average cost per unit. (Round answer to 2 decimal places, e.g. 2.76.)

Weighted average cost per unit   $[removed]

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Compute the April 30 inventory and the April cost of goods sold using the average-cost method. (Round answers to 0 decimal places, e.g. 2,760.)

Ending inventory   $[removed]
Cost of goods sold   $[removed]

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rief Exercise 8-6Amsterdam Company uses a periodic inventory system. For April, when the company sold 600 units, the following information is available.

    Units   Unit Cost   Total Cost
April 1 inventory   250   $10     $ 2,500  
April 15 purchase   400   12     4,800  
April 23 purchase   350   13     4,550  
    1,000         $11,850  


Compute the April 30 inventory and the April cost of goods sold using the FIFO method.

Ending inventory   $[removed]
Cost of goods sold   $[removed]

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Exercise 8-15

Shania Twain Company was formed on December 1, 2013. The following information is available from Twain’s inventory records for Product BAP.

    Units   Unit Cost
January 1, 2014 (beginning inventory)   600   $ 8
Purchases:        
   January 5, 2014   1,200   9
   January 25, 2014   1,300   10
   February 16, 2014   800   11
   March 26, 2014   600   12

A physical inventory on March 31, 2014, shows 1,600 units on hand.

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Prepare schedules to compute the ending inventory at March 31, 2014, under FIFO inventory methods. (Round answer to 0 decimal places, e.g. 2,760.)

    FIFO
Ending Inventory at March 31, 2014   $[removed]

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Prepare schedules to compute the ending inventory at March 31, 2014, under LIFO inventory methods. (Round answer to 0 decimal places, e.g. 2,760.)

    LIFO
Ending Inventory at March 31, 2014   $[removed]

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Calculate average-cost per unit. (Round answer to 2 decimal places, e.g. 2.76.)

Weighted average-cost per unit   $[removed]

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Prepare schedules to compute the ending inventory at March 31, 2014, under Weighted-average inventory methods. (Round answer to 0 decimal places, e.g. 2,760.)

    Weighted-Average
Ending Inventory at March 31, 2014   $[removed]

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Brief Exercise 9-1

Presented below is information related to Rembrandt Inc.’s inventory.

(per unit)   Skis   Boots   Parkas
Historical cost   $190.00   $106.00   $53.00
Selling price   212.00   145.00   73.75
Cost to distribute   19.00   8.00   2.50
Current replacement cost   203.00   105.00   51.00
Normal profit margin   32.00   29.00   21.25

Determine the following:

(a) the two limits to market value (i.e., the ceiling and the floor) that should be used in the lower-of-cost-or-market computation for skis.

Ceiling Limit   $[removed]
Floor Limit   $[removed]

(b) the cost amount that should be used in the lower-of-cost-or-market comparison of boots.

The cost amount   $[removed]

(c) the market amount that should be used to value parkas on the basis of the lower-of-cost-or-market.

The market amount   $[removed]

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Brief Exercise 9-2

Floyd Corporation has the following four items in its ending inventory.

Item   Cost   Replacement
Cost
  Net Realizable
Value (NRV)
  NRV less Normal
Profit Margin
Jokers   $2,000   $2,050     $2,100     $1,600  
Penguins   5,000   5,100     4,950     4,100  
Riddlers   4,400   4,550     4,625     3,700  
Scarecrows   3,200   2,990     3,830     3,070  


Determine the final lower-of-cost-or-market inventory value for each item.

Jokers   $[removed]
Penguins   [removed]
Riddlers   [removed]
Scarecrows   [removed]

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Brief Exercise 9-3

Kumar Inc. uses a perpetual inventory system. At January 1, 2014, inventory was $214,000 at both cost and market value. At December 31, 2014, the inventory was $286,000 at cost and $265,000 at market value.

Prepare the necessary December 31 entry under (a) the cost-of-goods-sold method (b) Loss method. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

No. Account Titles and Explanation Debit Credit
(a)  [removed] [removed] [removed]
   [removed] [removed] [removed]
(b)  [removed] [removed] [removed]
   [removed] [removed] [removed]

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Brief Exercise 9-8

Boyne Inc. had beginning inventory of $12,000 at cost and $20,000 at retail. Net purchases were $120,000 at cost and $170,000 at retail. Net markups were $10,000; net markdowns were $7,000; and sales revenue was $147,000. Compute ending inventory at cost using the conventional retail method. (Round ratios for computational purposes to 0 decimal places, e.g. 78% and final answer to 0 decimal places, e.g. 28,987.)

Ending inventory using the conventional retail method   $[removed]

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Apr 28 2020 View more View Less

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