During the audit of Financial Year ended at 30-06-2021, an accounting record of a manufacturing company, XYZ (Pvt.) Ltd. revealed that the company purchased following stocks during the said financial year: Date of Units Rate Sr. # Purchase 1 10-08-2020 1,800 150 2 22-08-2020 1,600 160 15-09-2020 1,000 180 4 19-09-2020 2,900 160 5 05-10-2020 1,500 170 6. 17-11-2020 800 180 7 28-11-2020 1,000 160 15-12-2020 2,700 150 9. 05-01-2021 600 170 10 22-01-2021 1,500 190 11 20-02-2021 1,000 200 12 10-03-2021 500 210 13 31-03-2021 1,800 190 14 12-04-2021 2,000 180 15 30-04-2021 700 200 16 20-05-2021 1,200 210 17 01-06-2021 900 200 18 20-06-2021 1,000 210 9,000 units were in closing stock at 30-06-2021. The company was using FIFO method as a company policy to calculate the cost of stock in trade and according to that, calculated its cost of 9,000 closing units as Rs. 1,583,265 Required: You have to detect and simultaneouly correct the error in above calculation. And find out the exact cost of 9,000 units by using FIFO method.

During the audit of Financial Year ended at 30-06-2021, an accounting record of a manufacturing company, XYZ (Pvt.) Ltd. revealed that the company purchased following stocks during the said financial year: Date of Units Rate Sr. # Purchase 1 10-08-2020 1,800 150 2 22-08-2020 1,600 160 15-09-2020 1,000 180 4 19-09-2020 2,900 160 5 05-10-2020 1,500 170 6. 17-11-2020 800 180 7 28-11-2020 1,000 160 15-12-2020 2,700 150 9. 05-01-2021 600 170 10 22-01-2021 1,500 190 11 20-02-2021 1,000 200 12 10-03-2021 500 210 13 31-03-2021 1,800 190 14 12-04-2021 2,000 180 15 30-04-2021 700 200 16 20-05-2021 1,200 210 17 01-06-2021 900 200 18 20-06-2021 1,000 210 9,000 units were in closing stock at 30-06-2021. The company was using FIFO method as a company policy to calculate the cost of stock in trade and according to that, calculated its cost of 9,000 closing units as Rs. 1,583,265 Required: You have to detect and simultaneouly correct the error in above calculation. And find out the exact cost of 9,000 units by using FIFO method.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Best Discount Furniture, Inc. completed the following treasury stock transactions in 2024: 1 (Click the icon to view the transactions.) Requirements 1. Journalize these transactions. Explanations are not required. 2. How will Best Discount Furniture, Inc. report treasury stock on its balance sheet as of December 31, 2024? Requirement 1. Journalize these transactions. (Record debits first, then credits. Exclude explanations from any journal entries.) Dec. 1: Purchased 1,800 shares of the company's $1 par value common stock as treasury stock, paying cash of $6 per share. Date Dec. 1 Accounts Debit Credit
On its December 31, 2020 balance sheet, a company correctly reported a $89,000 debit balance in its Fair Value Adjustment (Available-for-Sale) account. There was no change during 2021 in the composition of the company’s portfolio of available-for-sale securities. At the end of 2021, the following information pertains to the portfolio: Cost at 12/31/21 Fair value at 12/31/21 $269,000 $154,000 The unrealized gain/loss to appear as a component of comprehensive income for the year ending December 31, 2021 is $____________. (Very Important: if you obtain an unrealized holding loss, then you need to put a minus sign in front of the amount. If you obtain an unrealized holding gain, then no plus or minus sign is needed.)
The following accounts and their balances were selected from the unadjusted trial bal- ance of Point Loma Group Inc., a freight forwarder, at October 31, the end of the current fiscal year: Common Stock, no par, $14 stated value ... Paid-In Capital from Sale of Treasury Stock... Paid-In Capital in Excess of Par-Preferred Stock .... Paid-In Capital in Excess of Stated Value-Common Stock Preferred 2% Stock, $120 par . Retained Earnings $ 4,480,000 45,000 210,000 480,000 8,400,000 39,500,000 Prepare the Paid-In Capital portion of the stockholders' equity section of the balance sheet using Method 1 of Exhibit 8. There are 375,000 shares of common stock authorized and 85,000 shares of preferred stock authorized.
The following selected transactions relate to investment activities of Omamental Insulation Corporation during 2021. The company buys debt securities, intending to profit from short-term differences in price and maintaining them in an active trading portfolio. Ornamental's fiscal year ends on December 31. No investments were held by Ornamental on December 31, 2020. Mar. 31 Acquired 8% Distribution Transformers Corporation bonds costing $540,000 at face value. Sep. 1 Acquired $1,320,000 of American Instruments' 10% bonds at face value. Sep. 30 Received semiannual interest payment on the Distribution Transformers bonds. Oct. 2 Sold the Distribution Transformers bonds for $580,000. Nov. 1 Purchased $2,100,000 of M&D Corporation 6% bonds at face value. Dec. 31 Recorded any necessary adjusting entry(s) relating to the investments. The market prices of the investments are American Instruments bonds M&D Corporation bonds (Hint: Interest must be accrued.) Required: 1. Prepare the appropriate…
Presented below is information related to the purchases of common stock by Marigold Company during 2025. Investment in Arroyo Company stock Investment in Lee Corporation stock Investment in Woods Inc. stock Total (a) (b) Cost Fair Value (at purchase date) (at December 31) $102,000 $84,000 314,000 259,000 (b) 184,000 (Assume a zero balance for any Fair Value Adjustment account at the beginning of 2025.) $545,000 No. Account Titles and Explanation (a) 193,000 $591,000 What entry would Marigold make at December 31, 2025, to record the investment in Arroyo Company stock if it chooses to report this security using the fair value option? What entry would Marigold make at December 31, 2025, to record the investments in the Lee and Woods corporations, assuming that Marigold did not select the fair value option for these investments? (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is…
View Policies Current Attempt in Progress The following information was extracted from the accounts of Sandhill Co. at December 31, 2020: CR(DR). Total reported income since incorporation $4810000 Total cash dividends paid (2480000) Unrealized holding loss on available-for-sale securities (368000) Total stock dividends distributed (604000) Prior period adjustment, recorded January 1, 2020 226000 What should be the balance of retained earnings at December 31, 2020? O $1876000. O $ 1584000. O $ 1952000. O $ 3042800. Save for Later Attempts: 0 of 1 used Submit Answ
The following is a partial trial balance for General Lighting Corporation as of December 31, 2021: Account Title Debits Credits Sales revenue 2,350,000 Interest revenue 80,000 Loss on sale of investments 22,500 Cost of goods sold 1,200,300 Loss on inventory write-down (obsolescence) 200,000 Selling expense…
You’ve been hired to perform an audit of Hubbard Company for the year ended December 31, 2019. You find the following account balances related to shareholders’ equity: Preferred stock, $100 par $ 33,000 Common stock, $10 par 68,000 Capital surplus (15,100) Retained earnings 172,000 Because of the antiquated terminology and negative balance, you examine the Capital Surplus account and find the following entries: Credit (Debit) Additional paid-in capital on common stock $ 27,700 Capital from donated land 16,900 Treasury stock (400 common shares at cost) (5,600) Additional paid-in capital on preferred stock 2,000 Stock dividend (50%) (20,000) Prior period adjustment (net of income taxes) (10,100) Loss from fire (uninsured), 2018 (18,100) Property dividend declared (5,600) Cash dividends declared (23,300) Balance $ (36,100) Your examination of the Preferred Stock and Common Stock accounts reveals that the amounts shown correctly state the…
Required information [The following information applies to the questions displayed below.] Kitty Company began operations in the current year and acquired short-term debt investments in trading securities. The year-end cost and fair values for its portfolio of these debt investments follow. Trading Securities Tesla Bonds Nike Bonds Cost Fair Value $ 15,600 24,800 6,200 $ 11,700 26,040 4,960 Ford Bonds Prepare the journal entry to record the December 31 year-end fair value adjustment for these debt securities. View transaction list Journal entry worksheet 1 Record the year-end adjustment to fair value, if any. Note: Enter debits before credits. Date General Journal Debit Credit December 31 Record entry Clear entry View general journal
On its December 31, 2020 balance sheet, a company correctly reported a $342,000 credit balance in its Fair Value Adjustment (Available-for-Sale) account. There was no change during 2021 in the composition of the company’s portfolio of available-for-sale securities. At the end of 2021, the following information pertains to the portfolio: Cost at 12/31/21 Fair value at 12/31/21 $932,690 $874,360 The amount of unrealized holding gain/loss for the portfolio for the year ending December 31, 2021 is $____________. (Very Important: Just enter the amount. DO NOT put a plus or minus sign in front of the amount.)
Yankton Company began the year without an investment portfolio. During the year, it purchased investments classified as trading securities at a cost of $13,000. At the end of the year, the market value of the securities was $11,000. Yankton Company's financial statements for the current year should show Ca. no loss on the income statement, net trading securities of $11,000, and an unrealized loss of $2,000 as a stockholders' equity adjustment on the balance sheet b. no loss on the income statement and net trading securities of $13,000 on the balance sheet Cc. a loss of $2,000 on the income statement and net trading securities of $13,000 on the balance sheet Od. a loss of $2,000 on the income statement and temporary investments of $11,000 on the balance sheet
ABAKA Co. reported the following differences in the statement of financial position accounts on December 31, 2023 and 2022. Additional information: - Net income for the current year was P1,900,000 - During 2023, ABAKA Co. purchased trading securities for P900,000 cash and sold trading securities costing P500,000 for P800,000. On December 31, 2023, the market value of the remaining trading securities increased to P500,000. - Cash dividend of P500,000 was declared. - Equipment costing P800,000 and having a carrying amount of P550,000 was sold for P650,000. - Equipment costing P3,000,000 was acquired through issuance of long-term debt. - The long-term investment pertains to 20% common stock investment in SANDALS Corp. which was purchased on December 31, 2022. SANDALS Corp. reported 2023 net income at P5,000,000 and declared and paid dividends of P500,000. - 100,000 ordinary shares were issued for P20. Requirements: Determine the net cash provided by: a) Operating activities b)…