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Information about the ending inventories of Charleston Chair Company, who applies the LIFO method, is shown below. Selling Price Year 2020 2021 2022 Cost $10,000 15,000 20,000 Current Replacement Cost $11,500 13,000 18,600 $12,000 14,000 24,000 Cost of Completion $1,000 1,500 2,200 Normal Profit Margin $1,100 1,250 2,900 Required: a. Determine the value of the inventory for each year using the lower of cost or market rule. b. Assuming that Charleston Chair Company maintains a periodic inventory system, prepare journal entries for 2022 to record the reduction of the inventory to market value using: 1. the direct method 2. the allowance method

Information about the ending inventories of Charleston Chair Company, who applies the LIFO method, is shown below. Selling Price Year 2020 2021 2022 Cost $10,000 15,000 20,000 Current Replacement Cost $11,500 13,000 18,600 $12,000 14,000 24,000 Cost of Completion $1,000 1,500 2,200 Normal Profit Margin $1,100 1,250 2,900 Required: a. Determine the value of the inventory for each year using the lower of cost or market rule. b. Assuming that Charleston Chair Company maintains a periodic inventory system, prepare journal entries for 2022 to record the reduction of the inventory to market value using: 1. the direct method 2. the allowance method

FINANCIAL ACCOUNTING
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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Hi !!! I need some help with part B. Thank you!

 

 

 

 

General Journal General Journal Instructions b1. Assuming that Charleston Chair Company maintains a periodic inventory system, prepare journal entries for December 31, 2022 to record the re of the inventory to market value using the direct method. 1 2 3 1 2 3 4 5 In b2. Assuming that Charleston Chair Company maintains a periodic inventory system, prepare journal entries for December 31, 2022 to record the re of the inventory to market value using the allowance method. 6 DATE 7 GENERAL JOURNAL DATE ACCOUNT TITLE GENERAL JOURNAL POST. REF. ACCOUNT TITLE DEBIT POST. REF. PAGE 1 DEBIT CREDIT PAGE 1 CREDIT
Transcribed Image Text:General Journal General Journal Instructions b1. Assuming that Charleston Chair Company maintains a periodic inventory system, prepare journal entries for December 31, 2022 to record the re of the inventory to market value using the direct method. 1 2 3 1 2 3 4 5 In b2. Assuming that Charleston Chair Company maintains a periodic inventory system, prepare journal entries for December 31, 2022 to record the re of the inventory to market value using the allowance method. 6 DATE 7 GENERAL JOURNAL DATE ACCOUNT TITLE GENERAL JOURNAL POST. REF. ACCOUNT TITLE DEBIT POST. REF. PAGE 1 DEBIT CREDIT PAGE 1 CREDIT
Instructions Information about the ending inventories of Charleston Chair Company, who applies the LIFO method, is shown below: Year 2020 2021 2022 Cost $10,000 15,000 20,000 Current Replacement Cost $11,500 13,000 18,600 Selling Price $12,000 14,000 24,000 Cost of Completion $1,000 1,500 2,200 Normal Profit Margin $1,100 1,250 2,900 Required: a. Determine the value of the inventory for each year using the lower of cost or market rule. b. Assuming that Charleston Chair Company maintains a periodic inventory system, prepare journal entries for 2022 to record the reduction of the inventory to market value using: 1. the direct method 2. the allowance method
Transcribed Image Text:Instructions Information about the ending inventories of Charleston Chair Company, who applies the LIFO method, is shown below: Year 2020 2021 2022 Cost $10,000 15,000 20,000 Current Replacement Cost $11,500 13,000 18,600 Selling Price $12,000 14,000 24,000 Cost of Completion $1,000 1,500 2,200 Normal Profit Margin $1,100 1,250 2,900 Required: a. Determine the value of the inventory for each year using the lower of cost or market rule. b. Assuming that Charleston Chair Company maintains a periodic inventory system, prepare journal entries for 2022 to record the reduction of the inventory to market value using: 1. the direct method 2. the allowance method
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