All Things Auto are retailers who purchase and sell vehicle parts & accessories, including batteries. The business uses a perpetual inventory system and began the last quarter of 2020 with merchandise inventory of 1o bateries of the "Diellard" brand at a total cost of si68,200. The following transactions, relating to the "Dielard" brand were completed during the quarter: Purchased 15 batteries at a cost of $17,020 each. Sold 18 batteries at $22,2 50 per battery October 5 October 14 October 22 Purchased 24 batteries at a cost of S18,175 cach but the supplier gave a 4% quantity discount. November 10 Sold 15 batteries to Orion Auto Lad and 10 batteries to Brown's Auto Detailing at a price of $23.990 each. November 12 Owing to an increased demand for this brand of batteries, 30 batteries were purchased on account at a cost of $17,6 12 each. In addition, All Things Auto paid $288 in cash on each battery to have the inventory shipped from the vendor's warehouse to their location. November 27 Sold 23 batteries which yielded total sales revenue of $576,840. (8 of these batteries were sold on account to Middletoun Fuel & Auto Accessories a long standing customer) November 30 A customer, to whom 5 batteries were sold at the end of the business day on November 27, returned a units, as they were of the "Duralast" brand. In preparation for the festive season, All Things purchased 25 batteries at a total cost of $474.500. December 2 December 15 5 of the batteries purchased on December 2 were returned to the supplier, as the poles were either corroded or otherwise badly damaged. December 30 Sold 22 batteries to two customers (Omega Traders & Middleton Auto Accessories) at a selling price of Sa6.950 each. December 31 An actual count of inventory was carried out which revealed that there were 9 units of the Die Hard brand in the warehouse. All purchases were on account and received on the dates stated. Required: (A) Prepare a perpetual inventory record for All Things Auto, using the first in, first out (FIFO) method to determine the value of ending inventory at December 31, 2020, and the total amount to be assigned to cost of goods sold for the period. (B) Given that selling, distribution and administrative costs for the quarter were sa3.445. S10,250 ands75.435 respectively, prepare an income statement for All Things Auto (Die Hard) for the quarter ended December 31, 2020, to determine the net profit for the quarter. (C) Journalize the transactions on November 12 and November 27, assuming the business uses a Perpetual inventory system Perlodie inventory system

All Things Auto are retailers who purchase and sell vehicle parts & accessories, including batteries. The business uses a perpetual inventory system and began the last quarter of 2020 with merchandise inventory of 1o bateries of the "Diellard" brand at a total cost of si68,200. The following transactions, relating to the "Dielard" brand were completed during the quarter: Purchased 15 batteries at a cost of $17,020 each. Sold 18 batteries at $22,2 50 per battery October 5 October 14 October 22 Purchased 24 batteries at a cost of S18,175 cach but the supplier gave a 4% quantity discount. November 10 Sold 15 batteries to Orion Auto Lad and 10 batteries to Brown's Auto Detailing at a price of $23.990 each. November 12 Owing to an increased demand for this brand of batteries, 30 batteries were purchased on account at a cost of $17,6 12 each. In addition, All Things Auto paid $288 in cash on each battery to have the inventory shipped from the vendor's warehouse to their location. November 27 Sold 23 batteries which yielded total sales revenue of $576,840. (8 of these batteries were sold on account to Middletoun Fuel & Auto Accessories a long standing customer) November 30 A customer, to whom 5 batteries were sold at the end of the business day on November 27, returned a units, as they were of the "Duralast" brand. In preparation for the festive season, All Things purchased 25 batteries at a total cost of $474.500. December 2 December 15 5 of the batteries purchased on December 2 were returned to the supplier, as the poles were either corroded or otherwise badly damaged. December 30 Sold 22 batteries to two customers (Omega Traders & Middleton Auto Accessories) at a selling price of Sa6.950 each. December 31 An actual count of inventory was carried out which revealed that there were 9 units of the Die Hard brand in the warehouse. All purchases were on account and received on the dates stated. Required: (A) Prepare a perpetual inventory record for All Things Auto, using the first in, first out (FIFO) method to determine the value of ending inventory at December 31, 2020, and the total amount to be assigned to cost of goods sold for the period. (B) Given that selling, distribution and administrative costs for the quarter were sa3.445. S10,250 ands75.435 respectively, prepare an income statement for All Things Auto (Die Hard) for the quarter ended December 31, 2020, to determine the net profit for the quarter. (C) Journalize the transactions on November 12 and November 27, assuming the business uses a Perpetual inventory system Perlodie inventory system

FINANCIAL ACCOUNTING

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Chapter1: Financial Statements And Business Decisions

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Transcribed Image Text:All Things Auto are retailers who purchase and sell vehicle parts & accessories, including batteries. The business uses a perpetual inventory system and began the last quarter of 2020 with merchandise inventory of 10 batteries of the "DielHard" brand at a total cost of $168,200. The following transactions, relating to the "Dielard brand were completed during the quarter: October 5 October 14 October 22 November 10 Sold 15 batteries to Orion Auto Lid and 10 batteries to Brown's Auto Detailing at a price of Purchased 15 batteries at a cost of $17,020 each. Sold 18 batteries at $22,2 50 per battery Purchased 24 batteries at a cost of $18,175 cach but the supplier gave a 4% quantity discount. $23.990 each. November 12 Owing to an increased demand for this brand of batteries, 30 batteries were purchased on account at a cost of $17,612 each. In addition, All Things Auto paid $288 in cash on each battery to have the inventory shipped from the vendor's warehouse to their location. November 27 Sold 23 batteries which yielded total sales revenue of $576,840. (8 of the se batteries were sold on account to Middletoun Fuel & Auto Accessories a longstanding customer) November 30 A customer, to whom 5 batteries were sold at the end of the business day on November 27, returned 2 units, as they were of the "Duralast" brand. December 2 In preparation for the festive season, All Things purchased 25 batteries at a fotal cost of $474.500. December 15 5 of the batteries purchased on December 2 were returned to the supplier, as the poles were either corroded or otherwise badly damaged. December 30 Sold 22 batteries to two customers (Omega Traders & Middleton Auto Accessories) at a selling price of $26,950 each. December 31 An actual count of inventory was carried out which revealed that there were 9 units of the "Die Hard" brand in the warehouse. All purchases were on account and received on the dates stated. Required: (A) Prepare a perpetual inventory record for All Things Auto, using the first in, first out (FIFO) method to determine the val ue of ending inventory at December 31, 2020, and the total amount to be assigned to cost of goods sold for the period. (B) Given that selling, distribution and administrative costs for the quarter were $z3.445, S10,250 and$75-435 respectively, prepare an income statement for All Things Auto (DieHard) for the quarter ended December 31, 2020, to determine the net profit for the quarter. (C) Journalize the transactions on November 12 and November 27, assuming the business uses a Perpetual inventory system Periodic inventory system (D) Vallie Enterprise sells a product that cost $200 per unit and has a monthly demand of 500 units. The annual holding cost per unit is calculated as 2% of the unit purchase price. It costs the business $30 to place a single order. The maximum number of units sold for any one week is 150 and minimum sales 8o units. The vendor takes anywhere from 2 to 4 weeks to deliver the merchandise after the order is placed. The EOQ model is appropriate. i) What is the cost minimizing solution for this product each year? i) Determine the re-order level, minimum inventory level and maximum inventory level for the product.

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