You are auditing Marthas Prison Clothes Inc. as of December 31, 2020. The inventory for orange jumpsuits

Question:

You are auditing Martha’s Prison Clothes Inc. as of December 31, 2020. The inventory for orange jumpsuits shows 1,263 suits at $782 for a total of $987,666. When you look at the invoices for the jumpsuits, you see the following:

Required:

a. Determine the adjusting entry, if any, for the cost of inventory at December 31, 2020.

b. Would your answer to part (a) be different if you saw an invoice dated January 9, 2021, for 500 suits at $750?

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Auditing & Assurance Services

ISBN: 978-1260703733

8th Edition

Authors: Timothy Louwers, Penelope Bagley, Allen Blay, Jerry Strawser, Jay Thibodeau

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Question Posted: Jul 05, 2023 09:44 AM

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You are auditing Marthas Prison Clothes Inc. as of December 31, 2020. The inventory for orange jumpsuits

Question:

Inventory Number 12732 12844 12905 Date 11/22/20 12/03/20 12/28/20 Quantity Unit Price 1,000 800 600 $765 777 782 Total $765,000 621,600 469,200

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To determine the adjusting entry for the cost of inventory at December 31 2020 we need to compare th...View the full answer

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