In the system record, the amount of each type of fabric at 1 January 2020 is as follows:

	Egyptian Cotton	Crepe Silk	Songket
Unit (metres)	240	350	300
Cost per metre	RM38	RM115	RM350
Type			Terengganu

Additional information:

The balance of inventory of songket as at 31 December 2020 is:

1. Songket Terengganu: 170 metres
2. Songket Brunei: 80 metres
    

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Part 1: Semarak Murni Bhd (SMB)is a trading company in Malaysia that sells fabrics. It has been 10 years in the market and the company is very optimistic for its yearly sales growth. The company is now a leading company that received an overwhelming demand from customers. SMB has become customers' number one choice when it comes to fabrics due to the high quality, good designs, reasonable prices and variety of choices. SMB sells three types of fabrics: cotton, crepe silk and songket. Currently SMB uses perpetual inventory recording system. However, in terms of cost flow assumption, the company uses different method based on sales. Due to the characteristics of the fabrics and the pattern of sales made for each fabric, the company uses FIFO (First- In-First-Out) method for cotton, moving average method for crepe silk fabrics, and specific identification method for songket fabric. SMB uses calendar year in recording its accounting records and prepares its financial statements every 12-month. All transactions related to inventory are recorded using gross method. Followings are the details of the fabrics inventories as recorded in the system dated 1 January 2020. 15 January 1 March 30 March 20 April 5 May 13 June 7 July 10 September November 25 Received on hand the 500 metres of printed Egyptian Cotton from a supplier in Indonesia. The order was made on 13 December 2019. The cost for each metre is RM40. The import duties and taxes charged to the SMB for the purchases made are RM500 and RM250 respectively. The transportation cost to deliver the fabrics to the premise is RM300. The purchase of the fabric was made by cash. Payment to the supplier was made upon the receipt of the fabrics. Sold 30 metres of batik crepe silk to Kasuma Holdings by credit at a price of RM135 per metre. The credit terms given was 2/30, n/45. Received payment from Kasuma Holdings. Purchased 200 metres of Songket from a supplier in Brunei at the total cost of RM60,000. The transportation cost amounted RM270 is signed under FOB shipping point term. SMB receives trade discount of RM400 from the supplier. The purchase was made by cash. Purchased 50 metres of batik motif Crepe Silk from a supplier in Kelantan. Each metre of the fabric costs RM125. The transportation cost amounted RM150 is signed under FOB destination term. The purchase of the fabric was made by cash. Sold 25 metres of Egyptian Cotton at a price of RM55/metre and 130 metres of Songket Terengganu at a price of RM420/metre to Hasbul Sdn Bhd by cash. 5 metres of the batik motif Crepe Silk bought on 5 May were returned to the supplier due to major defect and received full payment. 4 metres of Egyptian Cotton was returned by Hasbul Sdn Bhd due to colour defect. Full payment was paid to the customer. Sold 120 metre of Songket Brunei to Landa Gim at a price of RM350/metre by credit with a term of 3/60, n/80. Part 1: Semarak Murni Bhd (SMB)is a trading company in Malaysia that sells fabrics. It has been 10 years in the market and the company is very optimistic for its yearly sales growth. The company is now a leading company that received an overwhelming demand from customers. SMB has become customers' number one choice when it comes to fabrics due to the high quality, good designs, reasonable prices and variety of choices. SMB sells three types of fabrics: cotton, crepe silk and songket. Currently SMB uses perpetual inventory recording system. However, in terms of cost flow assumption, the company uses different method based on sales. Due to the characteristics of the fabrics and the pattern of sales made for each fabric, the company uses FIFO (First- In-First-Out) method for cotton, moving average method for crepe silk fabrics, and specific identification method for songket fabric. SMB uses calendar year in recording its accounting records and prepares its financial statements every 12-month. All transactions related to inventory are recorded using gross method. Followings are the details of the fabrics inventories as recorded in the system dated 1 January 2020. 15 January 1 March 30 March 20 April 5 May 13 June 7 July 10 September November 25 Received on hand the 500 metres of printed Egyptian Cotton from a supplier in Indonesia. The order was made on 13 December 2019. The cost for each metre is RM40. The import duties and taxes charged to the SMB for the purchases made are RM500 and RM250 respectively. The transportation cost to deliver the fabrics to the premise is RM300. The purchase of the fabric was made by cash. Payment to the supplier was made upon the receipt of the fabrics. Sold 30 metres of batik crepe silk to Kasuma Holdings by credit at a price of RM135 per metre. The credit terms given was 2/30, n/45. Received payment from Kasuma Holdings. Purchased 200 metres of Songket from a supplier in Brunei at the total cost of RM60,000. The transportation cost amounted RM270 is signed under FOB shipping point term. SMB receives trade discount of RM400 from the supplier. The purchase was made by cash. Purchased 50 metres of batik motif Crepe Silk from a supplier in Kelantan. Each metre of the fabric costs RM125. The transportation cost amounted RM150 is signed under FOB destination term. The purchase of the fabric was made by cash. Sold 25 metres of Egyptian Cotton at a price of RM55/metre and 130 metres of Songket Terengganu at a price of RM420/metre to Hasbul Sdn Bhd by cash. 5 metres of the batik motif Crepe Silk bought on 5 May were returned to the supplier due to major defect and received full payment. 4 metres of Egyptian Cotton was returned by Hasbul Sdn Bhd due to colour defect. Full payment was paid to the customer. Sold 120 metre of Songket Brunei to Landa Gim at a price of RM350/metre by credit with a term of 3/60, n/80.

Answer rating: 100% (QA)

Calculate COGS inventory Part 1 Semarak Murni Bhd SMBis a trading company in Malaysia that sells fabrics It has been 10 years in the market and the company is very optimistic for its yearly sales grow... View the full answer