Whale Inc. was organized on January 1, 2020. December 31, 2021, the company lost most of itsinventory in a warehouse fire just before the year-end count of inventory was to take place. Thecompany's records disclosed the following data:20202021Inventory, Jan. 1204,000Purchases860,000692,000Purchase returns and allowance46,12064,600Sales788,000836,000Sales returns and allowances16,00020,000On January 1, 2021, Whale's pricing policy was changed so that the gross profit rate would be threepercentage higher than the one earned in 2020Salvaged undamaged merchandise was marked to sell at P24,000 while damaged merchandise markedto sell at P16,000 had an estimated realizable value of P3,600.REQUIRED:a. What is the company's gross profit rate beginning January 1, 2021?b. How much is the inventory fire lost?

a. Gross profit Rate for 2020 as, (Gross profit/ net sales) x 100 Net sales - cost of goods sold…

Answered: 860,000 692,000 ce 46,120 64,600…

Business

Accounting

860,000 692,000 ce 46,120 64,600 788,000 836,000 16,000 20,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Year 012 Cash flow 58000 -34000 -45000 G H What is the IRR? If the required return is 12%, should…

A: The difference between the current value of cash inflows and outflow of cash over a period of time…

Q: A consulting company has designed the accompanying spreadsheet model to compute a project's revenues…

A: Answer:The question describes a situation where a consulting company's spreadsheet model is used to…

Q: 6:05 IMG_0742.jpg X Wildhorse Company is considering buying a new farm that it plans to operate for…

A: Net present value (NPV): Net present value is one of the most applicable capital budgeting…

Q: Jefferson Memorial Hospital is an investment center as a division of Hospitals United. During the…

A: Residual income is also known as economic value added (EVA) and represents the true economic profit…

Q: The following data are projected for a possible investment project: 1 2 3 4 Revenues $130,000…

A: Initial Cash outlay = Initial investment + Working capital required

Q: $ 90,000 $ 40,000 $ 35,000 $ 15,000 $ 4,000 $ 5,000 $ 20,000 $ 1,000 $ 2,500 $ 105,000 $ 6,000 $…

A: Total Fixed Costs are the costs which are to be paid or settled irrespective of the number of units…

Q: Project A B C D Investment Required $ 200,000 $ 152,000 $ 100,000 $ 170,000 Present value of Cash…

A: Profitability index = (present value of cash inflows )/Initial investment Net present value is…

Q: P2 25. The city treasury began with $1,100,000 at the beginning of the year. Each day since, tax…

A: Tax revenues will add to the city treasury. On the other hand daily expenditure will cause the…

Q: The following data are projected for a possible investment project: 1 2 3 4…

A: Total cash flows in year 4 includes operating cash flows and Recovery of working capital and after…

Q: CH 5#9 The A Corporation is considering the construction of a new plant to build a component part…

A: Net present value is a quantitative technique used to calculate the present value of the cash flows…

Q: a. Determine the payback period of each project. b. Which project is acceptable based on payback…

A: Payback period = (Year of last negative cash flow+(Absolute value of last negative cash flow/Next…

Q: a Nay W F F 2 Casts and expenses Project A initial investment cost 528.000 years 4 7 annual…

A: It refers to a capital budgeting technique designed for comparing and evaluating investment projects…

Q: 25. Winston Corp, manufactures widgets. The company is setting up a new 7-year project i Jersey. The…

A: The OCF refers to the generation of cash by the company during its normal operations. It helps the…

Q: NPV $40,000 $20,000 $10,000 SO $50 $100 Cost of Goods Sold $150 The graph above shows the break-even…

A: NPV is a popular capital budgeting metric. NPV stands for Net Present Value. It is the sum of…

Q: PA6. LO 11.3 Gimli Miners recently purchased the rights to a diamond mine. It is estimated that…

A: Depletion expense is a non-cash expense in a accrual accounting method which is used to allocate the…

Q: 2018 2019 Output (units) 120,000 126,000 Selling price per unit $25.00 $25.00…

A: Productivity changes in labour can be influenced by various factors such as technological…

Q: Project: German Year 0: -$650,000 Year 1: $220,000 Year 2: $240,000 Year 3: $245,000 Year 4:…

A: Net Present Value (NPV) is a financial metric used to evaluate the profitability of an investment by…

Q: this is Capital budgeting tools ch 12 p 25 build a model

A: Answer:(d).Understanding the Crossover Rate: The crossover rate is the discount rate at which the…

Q: 6:04 IMG_0743.jpg X You are the CFO of Carla Vista, Inc., a retailer of the exercise machine…

A: The initial investment cost of store is $33,500,000.According to straight line depreciation, the…

Q: X Corp recorded the following journal entry for a long-term project during the year ended December,…

A: In the given case, we will use the percentage-of-completion method for recognizing the costs and…

Q: Falkland, Inc., is considering the purchase of a patent that has a cost of $51,000 and an estimated…

A: To calculate the NPV of the investment, we need to discount the cash flows back to their present…

Q: MANAGEMENT OF TECHNOLOGY Project Selection Based on Economic Analysis 0.1 = MARR' Technology "A"…

Q: $300.000 $210.000 $340.000 $850.000 ts $180.000 $180.000 $220.000 $590,000 50.000 50000 40.000…

A: Solution: Change in net income = Avoidable fixed cost - contribution margin lost on Product G = 0 -…

Q: Project Bono Project Edge Project Clayton Capital investment $160,000 $190,000 $206,000 Annual net…

A: The problem involves the different capital budgeting techniques used by investors to assess the…

Q: Again, you are considering two mutually exclusive projects. Machine A: This project costs $10…

Q: At the beginning of 2020, your company buys a $32,400 piece of equipment that it expects to use for…

A: Disclaimer: “Since you have posted a question with multiple sub-parts, we will solve the first three…

Question

Whale Inc. was organized on January 1, 2020. December 31, 2021, the company lost most of its
inventory in a warehouse fire just before the year-end count of inventory was to take place. The
company's records disclosed the following data:
2020
2021
Inventory, Jan. 1
204,000
Purchases
860,000
692,000
Purchase returns and allowance
46,120
64,600
Sales
788,000
836,000
Sales returns and allowances
16,000
20,000
On January 1, 2021, Whale's pricing policy was changed so that the gross profit rate would be three
percentage higher than the one earned in 2020
Salvaged undamaged merchandise was marked to sell at P24,000 while damaged merchandise marked
to sell at P16,000 had an estimated realizable value of P3,600.
REQUIRED:
a. What is the company's gross profit rate beginning January 1, 2021?
b. How much is the inventory fire lost?

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

FIll in the blanks 1. _____ = 27,000 + 39,000 - 33,000 + 32,000 - 3,000 2. 51,000 = ____ + 28,000 - 6,000 + 7,000 - 12,000 3. 79,000 = 36,000 + ____ - 5,000 + 18,000 - 11,000
345678 Sources of Sales Estimate a Sales Manager 1st Quarter $520,000 2nd Quarter 3rd Quarter 4th Quarter $410,000 $370,000 $610,000 b Marketing Consultant $540,000 $480,000 $400,000 $630,000 C Production Manager $460,000 $360,000 $350,000 $580,000 9 They have estimated that the cost of goods sold is 70 percent of sales. The company tries to maintain 10 percent of next quarter's expected cost of goods sold as the current quarter's ending inventory. The ending inventory of this year is $25,000. For budgeting, the ending inventory of the next year is expected to be $28,000. 70% 10% $25,000 $28,000 10 11 Required 12 a. Complete the spreadsheet below to allow the inventory purchases budget to be prepared for each of the estimates above. 13 14 Spreadsheet Tips 1. This spreadsheet uses a function called vertical lookup. This function can pull the appropriate values from a table. The form 15 of this function is =VLOOKUP(value,table,column#). In this example, the table is in cells A5 to F7.…
A8
Hw.61