Forest Company has five products in its inventory. Information about ending inventory follows. Unit Replacement Unit Selling Cost Price $ 23 25 15 13. 20 Product A B с D E Quantity 1,000 700 1,000 900 600 Unit Cost 72222 $17 Product (units) A (1,000) B (700) C (1,000) 10 D (900) E (600) 14 21 The cost to sell for each product consists of a 15 percent sales commission. The normal profit for each product is 40 percent of the selling price. RC Required: 1. Determine the carrying value of ending inventory, assuming the lower of cost or market (LCM) rule is applied to individual products. 2. Determine the carrying value of inventory, assuming the LCM rule is applied to the entire inventory. 3. Assuming inventory write-downs are common for Forest, record any necessary year-end adjusting entry based on the amount calculated in requirement 2. Required 1 Required 2 Required 3 $19 18 9 Complete this question by entering your answers in the tabs below. 11 19 Determine the carrying value of ending inventory, assuming the lower of cost or market (LCM) rule is applied to individual products. Note: Do not round intermediate calculations. NRV NRV minus NP Total Required 1 Market Cost Required 2 > Inventory value

Forest Company has five products in its inventory. Information about ending inventory follows. Unit Replacement Unit Selling Cost Price $ 23 25 15 13. 20 Product A B с D E Quantity 1,000 700 1,000 900 600 Unit Cost 72222 $17 Product (units) A (1,000) B (700) C (1,000) 10 D (900) E (600) 14 21 The cost to sell for each product consists of a 15 percent sales commission. The normal profit for each product is 40 percent of the selling price. RC Required: 1. Determine the carrying value of ending inventory, assuming the lower of cost or market (LCM) rule is applied to individual products. 2. Determine the carrying value of inventory, assuming the LCM rule is applied to the entire inventory. 3. Assuming inventory write-downs are common for Forest, record any necessary year-end adjusting entry based on the amount calculated in requirement 2. Required 1 Required 2 Required 3 $19 18 9 Complete this question by entering your answers in the tabs below. 11 19 Determine the carrying value of ending inventory, assuming the lower of cost or market (LCM) rule is applied to individual products. Note: Do not round intermediate calculations. NRV NRV minus NP Total Required 1 Market Cost Required 2 > Inventory value

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Beta Company produces a specialty wood furniture product, and has the following information available concerning its inventory items: Relevant ordering costs per purchase order $417 Relevant carrying costs for each unit of product: Required annual return on investment 15% Required other costs $7.38 The purchase price per unit of the product is $46. If the economic order quantity (EOQ) is given as 1473 units, computer the total relevant carrying costs of the product over a period between orders.
A firm that sells a single product had a beginning inventory of 10,000 units with a total cost of BD26,000. Early in the year, 4,000 units were purchased at BD4 each. Using WA method, What is the value of the ending inventory of 3,000 units (using a periodic inventory system). * BD 15,000 BD 10,000 BD 9,000
The trailer company exspects to sell 9000 for $155 each for a total of $1,395,000 in January and 4500 units for $225 each for a total of $1,012,500 in February. The company exspects the cost of goods sold to average 70% of sales revenue, and the company exspects to sell 4700 units in march for $290 each. Trailer's target ending inventory is $9000 plus 50% of next months cost of goods sold. Prepare Trailer's inventory, purchases, and cost of goods sold budget for January and February. Trailer Company Inventory, Purchases, and Cost of Goods Sold Budget Two months Ended January 31 and February 28 January february cost of goods sold Plus: Desired ending merchandise inventory Total merchandise inventory required Less: Beginning merchandise inventory Budgeted purchases
Question 18 Choose the correct answer from the choices.
Entity A's monthly inventory requirement is 300 units. The ordering cost are P50 per order while the annual cost are expected to be P1.00 per unit. Requirement: 1. Compute the Economic Order Quantity. 2. Prepare the table which the entity can procure inventories in several lots as follows : 3,600 units; 1,800 units, 600 units and 360 units. Use this table Order Size Number of Total Cost to Average Total Cost to Total Cost to Orders Order Inventory Carry Order and Total Cost to Carry
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During the year, Wright Company sells 425 remote-control airplanes for $110 each. The company has the following inventory purchase transactions for the year. Number Date Transaction of Units Unit Cost Total Cost $ 4,740 19,270 14,790 Jan. 1 $79 Beginning inventory Purchase 60 Мay 5 Nov. 3 235 82 Purchase 170 87 465 $ 38,800 Calculate ending inventory and cost of goods sold for the year, assuming the company uses LIFO. LIFO Cost of Goods Available for Sale Cost of Goods Sold Ending Inventory Cost of Average # of units Cost per Average # of units Cost per unit Cost of Goods Average Cost Goods Ending Inventory # of units Available unit for Sale Sold per unit Beginning Inventory $ $ $ Purchases: May 5 $ Nov. 3 $ Total
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