PROBLEM U:The following information came from the books and records of the Home Office and its branch. The balances asof December 31, 2020 are as follows:Branch170,000Home office300,000SalesShipments to branchShipments from home officePurchasesOperating expensesInventory, December 31, 2019Allowance for overvaluation of branch inventory48,00060,00036,00042,00032,000120,00080,00050,00017,200There were no shipment in transit between the Home office and the branch. Both shipment accounts are properlyrecorded. The closing inventory of the branch at billed price is P16,800, P6,000 of which were acquired fromoutside suppliers. The closing inventory of the home office is P18,000. The home office applies a uniformpercentage markup on the shipments of inventory to the branch from year to year.25. How much is the overvaluation in branch's ending inventory as of December 31, 2020?A.С.15,04017,200В.2,160D.26. How much is the net income (loss) of the branch for 2020 in so far as the home office is concerned?А.21,200С.31,840В.(21,200)D.(31,840)

Name: PROBLEM U:The following information came from the books and records o
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Description: PROBLEM U:The following information came from the books and records of the Home Office and its branch. The balances asof December 31, 2020 are as follows:Branch170,000Home office300,000SalesShipments to branchShipments from home officePurchasesOpera

We are given information from the books and records from the home office as well as branch as on…

Business

Accounting

25. How much is the overvaluation in branch's ending inventory as of December 31, 2020? А. C. 15,040 В. 2,160 D. 17,200 26. How much is the net income (loss) of the branch for 2020 in so far as the home office is concerned? 21,200 (21,200) А. С. 31,840 В. D. (31,840)

25. How much is the overvaluation in branch's ending inventory as of December 31, 2020? А. C. 15,040 В. 2,160 D. 17,200 26. How much is the net income (loss) of the branch for 2020 in so far as the home office is concerned? 21,200 (21,200) А. С. 31,840 В. D. (31,840)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Concept explainers

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.

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Question

PROBLEM U:
The following information came from the books and records of the Home Office and its branch. The balances as
of December 31, 2020 are as follows:
Branch
170,000
Home office
300,000
Sales
Shipments to branch
Shipments from home office
Purchases
Operating expenses
Inventory, December 31, 2019
Allowance for overvaluation of branch inventory
48,000
60,000
36,000
42,000
32,000
120,000
80,000
50,000
17,200
There were no shipment in transit between the Home office and the branch. Both shipment accounts are properly
recorded. The closing inventory of the branch at billed price is P16,800, P6,000 of which were acquired from
outside suppliers. The closing inventory of the home office is P18,000. The home office applies a uniform
percentage markup on the shipments of inventory to the branch from year to year.
25. How much is the overvaluation in branch's ending inventory as of December 31, 2020?
A.
С.
15,040
17,200
В.
2,160
D.
26. How much is the net income (loss) of the branch for 2020 in so far as the home office is concerned?
А.
21,200
С.
31,840
В.
(21,200)
D.
(31,840)

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Qw.13.
50
pp. Subject Accounting
2. A company has inventory on hand at year-end (31 December 2021) that it expects to be able to sell in the ordinary course of business for Rs. 10,000. The cost of these inventories is Rs: 7,000. In order to sell this inventory, the company expects to incur selling costs of Rs. 2,000 and expects to incur further costs of Rs. 3,000 to put this inventory into a saleable condition. Required: a. Calculate the net realizable value b. Calculate any possible write-down and c. Journalize any write-down necessary. d. Show where the write-down would be included and disclosed in the financial statements.
A 105.
(b) Your answer is correct. Calculate the days in inventory for 2020, 2021, and 2022. (Round answers to 1 decimal places, e.g. 15.2.) (c) 2020 86.9 days eTextbook and Media 2021 121.7 days 2022 125.9 days Attempts: unlimited Calculate the gross profit rate for 2020, 2021, and 2022. (Round answers to 1 decimal places, e.g. 15.2%.) Gross profit rate eTextbook and Media Save for Later 2020 % 2021 % 2022 Attempts: unlimited Submit Answer
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