Define inventory and state various methods that can be used for valuation of inventory with the help
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Question:
Define inventory and state various methods that can be used for valuation of inventory with the
help of suitable example. marks Q Edmund Fox opened Fox Corporation Ltd as on January which deals in car rentals,
repairs and service. On January the trial balance is as follows:
Fox Corporation Ltd
Trial Balance as on January Debit
$
$
$
$
$ $
Credit
$
$
$
$
$
$
Particulars
Cash
Prepaid Insurance Supplies Equipment
Notes Payable Accounts Payable Unearned Revenue Foxs Capital Foxs Drawings Service Revenue Rent Expense Total
Prepaid insurance is the cost of a month insurance policy that started at January
Supplies costing $ were in hand on January
The equipment is expected to have a useful life of four years.
The note payable is dated January It is a sixmonth, with interest payable on the
first of each month staring February
Seven customers paid for the companys sixmonth service package costing $ at the
beginning of the month ie January These customers were served for the month of
January.
Car repair services performed for other customers but not billed or recorded as on January
total $
Using the above information:
a Prepare Adjusted Trial Balance as on January
b Prepare an income statement, statement of owners equity and Balance Sheet.
Related Book For
Entrepreneurial Finance
ISBN: 978-0538478151
4th edition
Authors: J . chris leach, Ronald w. melicher
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