Linfei Ltd. has a 31 December year-end, and a tax rate of 40%. Management has asked you to respond to the following situations: 1. The company has always used the FIFO method of determining inventory costs; starting in 20X7, it will now use average cost. Opening and closing inventories for 20X7 under FIFO are $543,000 and $674,800, respectively. Opening and closing inventories under average cost are $429,600 and $532,000, respectively. Provide the journal entry to record the change. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet < 1 Record the entry to retrospectively account for the effect of change in inventory policy. Note: Enter debits before credits. Date 1 January 20X7 General Journal Debit Credit

Linfei Ltd. has a 31 December year-end, and a tax rate of 40%. Management has asked you to respond to the following situations: 1. The company has always used the FIFO method of determining inventory costs; starting in 20X7, it will now use average cost. Opening and closing inventories for 20X7 under FIFO are $543,000 and $674,800, respectively. Opening and closing inventories under average cost are $429,600 and $532,000, respectively. Provide the journal entry to record the change. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet < 1 Record the entry to retrospectively account for the effect of change in inventory policy. Note: Enter debits before credits. Date 1 January 20X7 General Journal Debit Credit

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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The Westmoreland Corporation uses a periodic system for its inventory. The company starts the current year with inventory costing $177,000. During the year, an additional $387,000 is paid for inventory purchases and $17,000 for transportation costs to get those items. A physical count at the end of the year finds $145,000 of ending inventory. How was each of these numbers derived? What is the company’s cost of goods sold?
Read CA8-11. in the end of chapter materials of Chapter 8 and answer the related questions. (LIFO Choices) Wilkens Company uses the LIFO method for inventory costing. In an effort to lower net income, company president Mike Wilkens tells the plant accountant to take the unusual step of recommending to the purchasing department a large purchase of inventory at year-end. The price of the item to be purchased has nearly doubled during the year, and the item represents a major portion of inventory value. Answer the following questions: (a) Identify the major stakeholders. If the plant accountant recommends the purchase, what are the consequences? (b) If Wilkens Company were using the FIFO method of inventory costing, would Mike Wilkens give the same order? Why or why not?
The following details taken from the books of DiDi Sdn Bhd for the year ending 31 December 2020. DiDi Sdn Bhd Statement Profit or Loss for the year ending 31 December 2020 (extract) RM RM Gross profit 44,700 Add : Discount received 410 Profit on sale of van 620 1,030 45,730 Less: Expenses Motor expenses 1,940 Wages 17,200 General expenses 830 Bad debts 520 Increase in allowance for doubtful debts 200 Depreciation : van 1,800 22,490 23,240 Statement of Financial Position as at 31 December 2019 2020 RM RM RM RM Non-current Assets Vans at cost 15,400 8,200 less Depreciation (5,300) (3,100) 10,100 5,100 Current Assets Inventory 18,600 24,000 Trade accounts receivables less provision*…
Rose Co. sells one product and uses the last-in, first-out method to determine inventory cost. Information for the month of January follows: Beginning inventory, 1/18,000 Purchases, 1/5 Sales Rose has determined that at January 31, the replacement cost of its inventory was $8 per unit, and the net realizable value was $8.80 per unit. Rose's normal profit margin is $1 per unit. Rose applies the lower-of-cost-or-market rule to total inventory and records any resulting loss. At January 31, what should be the net carrying amount of Rose's inventory? OA) $80,000 OB) $79,000 OC) $78,000 Total Units Unit Cost D) $81,400 12,000 10,000 $8.20 7.90
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SLR Corporation has 3,000 units of each of its two products in its year-end inventory. Per unit data for each of the products are as follows: Cost Selling price Costs to sell Product 1 $ 90 170 7 Determine the carrying value of SLR's inventory assuming that the lower of cost or net realizable value (LCNRV) rule is applied to individual products. What is the before-tax income effect of the LCNRV adjustment? Complete this question by entering your answers in the tabs below. Product 2 $ 54 56 3 Required 1 Required 2 Determine the carrying value of SLR's inventory assuming that the lower of cost or net realizable value (LCNRV) rule is applied to individual products. Product Cost NRV 1 2 Cost Selling price Costs to sell Per Unit Inventory Value Product 1 $ 90 170 7 Cost Unit $ Inventory value 0 Required 2 >
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Wilkens Company uses the LIFO method for inventory costing. In an effort to lower net income, company president Mike Wilkens tells the plant accountant to take the unusual step of recommending to the purchasing department a large purchase of inventory at year-end. The price of the item to be purchased has nearly doubled during the year, and the item represents a major portion of inventory value. Instructions Answer the following questions. a. Identify the major stakeholders. If the plant accountant recommends the purchase, what are the consequences? b. If Wilkens Company were using the FIFO method of inventory costing, would Mike Wilkens give the same order? Why or why not?
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I do not understand the desired ending inventory in exercise 11. I cannot figure the calculations to get that number.