Part Two: Work OutProblem One:Tale Company had the following beginning inventory and purchases during 2002:Item XUnit costDateUnit'sBr. 14Jan. 1Inventory40015March 10Purchase20016May 9Sep. 22Purchase300Purchase25020Nov. 28Purchase10021At december 31, 2002, there were 550 units of X on hand.Sales of units were as follows:Jan. 15200 units at Br. 30April 1200 units at Br. 30Nov. 1300 units at Br. 35Required: Apply the four different methods of inventory costing to calculate endinginventory & Cost of merchandise sold under:Periodic inventory systemi)ii)Perpetual inventory system Problem TwoCorporation's ending inventory includes the following items.CommodityWUnit Market Price$3440Inventory QuantityUnit Cost Price$ 30405024Y4860262044Calculate lower of cost or market for the inventory20a) As a wholeb) Applied separately to each productsProblem Three:On October 5, 2001, NOON C. acquired a new machine at a cost of Birr 250,000. Themachine has a useful life of 5 years and salvace value of Br. 10,000. It is estimated that theequipment will produce 2,000,000 units of products throughout its life. The equipmentproduced 95,000 units and 300,000 units of products during the fiscal periods endingDecember 31, 2001 and December 31, 2002 respectively. On the basis of the above data,compute depreciation expense to be recorded on Dec. 31, 2002 using:i. The units of production methodii. The declining-balance methodiii. The sum-of-years-digits methodiv. The straight-line methodProblem Four:Equipment purchased on January, 3, 2008, for S80,000 was depreciated using straight linemethod based upon a 5 years life and $7,500 residual value. The equipment was sold onDecember 31, 2010 for $40,000. What is the gain on the sale of the equipment?

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Problem One: Tale Company had the following beginning inventory and purchases during 2002: Item X Unit cost Date Unit's Br. 14 Jan. 1 Inventory 400 15 March 10 Purchase 200 16 May 9 Sep. 22 Nov. 28 Purchase 300 Purchase 250 20 Purchase 100 21 At december 31, 2002, there were 550 units of X on hand. Sales of units were as follows: Jan.15 200 units at Br. 30 April 1 200 units at Br. 30 Nov. 1 300 units at Br. 35 Required: Apply the four different methods of inventory costing to calculate ending inventory & Cost of merchandise sold under: i) Periodic inventory system ii) Perpetual inventory system

Problem One: Tale Company had the following beginning inventory and purchases during 2002: Item X Unit cost Date Unit's Br. 14 Jan. 1 Inventory 400 15 March 10 Purchase 200 16 May 9 Sep. 22 Nov. 28 Purchase 300 Purchase 250 20 Purchase 100 21 At december 31, 2002, there were 550 units of X on hand. Sales of units were as follows: Jan.15 200 units at Br. 30 April 1 200 units at Br. 30 Nov. 1 300 units at Br. 35 Required: Apply the four different methods of inventory costing to calculate ending inventory & Cost of merchandise sold under: i) Periodic inventory system ii) Perpetual inventory system

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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