Determine the firm's proper Cost of Goods Sold for Year 1. Determine the firm's proper Ending Inventory
Fantastic news! We've Found the answer you've been seeking!
Question:
- Determine the firm's proper Cost of Goods Sold for Year 1.
- Determine the firm's proper Ending Inventory at the end of Year 2.
- Determine the firm's proper Gross Margin for Year 3.
Transcribed Image Text:
Leventhal Company uses the periodic system. The firm has tentatively prepared the followed (partial) income statements and has asked you to review some accounting records related to sales and inventory transactions that occurred in these three years. Year 1 Year 2 Year 3 Sales $630 $660 $650 Begin inv $40 $50 $70 Purchases 480 490 470 (End Inv) -50 -70 -60 CGS 470 470 480 GM 160 190 170 Leventhal conducts its physical inventory in the early morning on Dec. 31 in each year so its workers can take that afternoon off. These ending inventory values are from these physical counts. The firm uses the periodic system. In reviewing the firm's inventory records, you have discovered the following items that might require adjustments to the physical counts for each year and/or the accounting records in all three years. The firm's fiscal year ends on Dec. 31. i Leventhal sold $20 worth of goods to a customer on Dec. 29, Year 1. The invoice was mailed on Jan, 2, Year 2, and the sale was recorded in the books for Year 2 on that day. The shipping terms were FOB shipping point and FedEx picked up the goods late in the afternoon on Dec. 31, Year 1. The goods arrived at customer's receiving dock on Jan. 4, Year 2. These goods had a cost of $10. Leventhal sold $30 of goods to a customer on Dec. 29, Year 2. The cost of these goods was $20. The sales terms were FOB destination. FedEx picked up goods late in the afternoon on Dec. 30, Year 2. The goods arrived on Jan. 5, Year 3. Leventhal mailed the invoice to the customer on Dec. 30, Year 2, and Leventhal recorded the sale in the books for Year 2 on that date. Leventhal bought goods from a supplier at a price of $30 on Dec. 28, Year 3. The terms of the purchase were FOB shipping point. The supplier shipped the goods on Dec. 3o, Year 3. Leventhal received the invoice from the supplier and recorded the purchase in the books for Year 4 on Jan. 2, Year 4. The goods arrived at Leventhal's receiving dock on Jan. 5, Year 4. Leventhal Company uses the periodic system. The firm has tentatively prepared the followed (partial) income statements and has asked you to review some accounting records related to sales and inventory transactions that occurred in these three years. Year 1 Year 2 Year 3 Sales $630 $660 $650 Begin inv $40 $50 $70 Purchases 480 490 470 (End Inv) -50 -70 -60 CGS 470 470 480 GM 160 190 170 Leventhal conducts its physical inventory in the early morning on Dec. 31 in each year so its workers can take that afternoon off. These ending inventory values are from these physical counts. The firm uses the periodic system. In reviewing the firm's inventory records, you have discovered the following items that might require adjustments to the physical counts for each year and/or the accounting records in all three years. The firm's fiscal year ends on Dec. 31. i Leventhal sold $20 worth of goods to a customer on Dec. 29, Year 1. The invoice was mailed on Jan, 2, Year 2, and the sale was recorded in the books for Year 2 on that day. The shipping terms were FOB shipping point and FedEx picked up the goods late in the afternoon on Dec. 31, Year 1. The goods arrived at customer's receiving dock on Jan. 4, Year 2. These goods had a cost of $10. Leventhal sold $30 of goods to a customer on Dec. 29, Year 2. The cost of these goods was $20. The sales terms were FOB destination. FedEx picked up goods late in the afternoon on Dec. 30, Year 2. The goods arrived on Jan. 5, Year 3. Leventhal mailed the invoice to the customer on Dec. 30, Year 2, and Leventhal recorded the sale in the books for Year 2 on that date. Leventhal bought goods from a supplier at a price of $30 on Dec. 28, Year 3. The terms of the purchase were FOB shipping point. The supplier shipped the goods on Dec. 3o, Year 3. Leventhal received the invoice from the supplier and recorded the purchase in the books for Year 4 on Jan. 2, Year 4. The goods arrived at Leventhal's receiving dock on Jan. 5, Year 4.
Expert Answer:
Answer rating: 100% (QA)
Determine the firms proper Cost of Goods Sold for Year 1 Ending inventory on 1 year 5... View the full answer
Related Book For
Financial and Managerial Accounting
ISBN: 978-0538480895
11th Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren
Posted Date:
Students also viewed these accounting questions
-
The actual variable cost of goods sold for a product was $ 70 per unit, while the planned variable cost of goods sold was $68 per unit. The volume increased by 1,200 units to 7,000 actual total...
-
Periodic inventory by three methods; cost of goods sold The units of an item available for sale during the year were as follows: Jan. 1 Inventory 40 units at $122 Mar. 10 Purchase 60 units at $130...
-
Inventory turnover is calculated as cost of goods sold divided by ending inventory . 1. True 2. False
-
During the year 100,000 parts were handled 80,000 for regular stroller and 20,000 for jogging strollers 20,000 firmness tests were conducted 13,000 for regular stroller and 7,000 for jogging and...
-
What is multicollinearity? What problems can be caused by multicollinearity? Discuss.
-
Christine Law is the Chief Investment Officer for Elite Investment Company. She is now calculating the equity value of Rays Food Company. In 2018, Elite paid a dividend of $5 per share. By 2022, that...
-
A military base in the United States is examining the distribution of the amount of time that officers on the base have been in the military. The following data show the years of military service for...
-
The comparative balance sheets for Beckwith Products Company are presented below. Additional Information: 1. Net income for 2011 was $58,400. 2. Cash dividends of $25,000 were declared and paid...
-
Determine the centroid of the following objects (in x,y format). Object A is solid. Object B ios not solid, and is made from bars of equal mass/meter. (0,0) 12 m 6m (0,0) 6m 14m 5m 3m This is a Solid...
-
The proposed rates were not in the range the CEO expected given the pricing analysis. The CEO has asked the pricing actuary to verify the total projected loss cost excluding potential large storm...
-
Which of the following are true about classes and struct? A class is a reference type, whereas a struct is a value type. Objects are created using new , whereas structure variables can be created...
-
has anyone ever evaluated the effectiveness of your staffing and selection process in terms of quality of hire or retention?describe the evaluation process and the outcome. what did you change in...
-
low-ranking staff member who is on a first name basis with the Director/Executive Officer?)
-
Discuss the key components of behavior modeling training.
-
Assess the risks to determine which you believe are big. Which two of these risks do you feel are showstoppers? How would you plan a risk-based spike for one of these big risks?
-
Apply the scientific method by developing a null and an alternative hypothesis that provides potential answers to the research question. What amount and intensity of exercise is likely to relieve...
-
Cooper and Brandy are married and file a joint income tax return with two separate Schedule Cs. Cooper is an independent security specialist who spent $635 on uniforms during the year. His laundry...
-
Extend Algorithms 3.4 and 3.5 to include as output the first and second derivatives of the spline at the nodes.
-
Identify each of the following as relating to (a) The control environment, (b) Control procedures, or (c) Information and Communication. 1. Separating related operations 2. Report of internal...
-
The productions supervisor of the Machining department for Cramer Company agreed to the following monthly static budget for the up coming year: Cramer Company Machining Department Monthly Production...
-
The units of an item available for sale during the year were as follows: There are 23 units of the item in the physical inventory at December 31. The periodic inventory system is used. Determine the...
-
Diehl Cleaners has the following statement of financial position items. Instructions Classify each item as an asset, liability, or equity. Analyze the effect of transactions. Accounts payable Cash...
-
Erin Danielle, the bookkeeper for Liverpool Ltd., has been trying to determine the correct statement of financial position for the company. The companys statement of financial position is shown...
-
Which of the following is true? a. Financial frauds have not occurred in U.S. companies because GAAP has detailed accounting and disclosure requirements. b. Transaction analysis is basically the same...
Study smarter with the SolutionInn App