Question 4 093 (LCNRV-Valuation Account) Presented below is information related to Knight Enterprise Jan. 31 Feb. 28 Mar. 31 Apr. 30 $14,000 13,300 26,500 40,000 $15,000 Inventory at cost Inventory at NRV Purchases for the month $15,100 12,600 17,000 $17,000 15,600 14,500 24,000 Sales for the month 29,000 35,000 Instructions a. From the information, prepare (as far as the data permit) monthly income statements in columnɛ form for February, March, and April. The inventory is to be shown in the statement at cost; the gai or loss due to NRV market fluctuations is to be shown separately (using a valuation account). b. Prepare the journal entry required to establish the valuation account at January 31 and entries adjust it monthly thereafter.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Question 4
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(LCNRV–Valuation Account) Presented below is information related to Knight Enterprise
Jan. 31
Feb. 28
Mar. 31
Apr. 30
Inventory at cost
Inventory at NRV
Purchases for the month
$15,000
$15,100
$17,000
15,600
$14,000
14,500
12,600
13,300
17,000
24,000
35,000
26,500
40,000
Sales for the month
29,000
Instructions
a. From the information, prepare (as far as the data permit) monthly income statements in column?
form for February, March, and April. The inventory is to be shown in the statement at cost; the gai
or loss due to NRV market fluctuations is to be shown separately (using a valuation account).
b. Prepare the journal entry required to establish the valuation account at January 31 and entries
adjust it monthly thereafter.
Transcribed Image Text:to ae Question 4 melt moll (LCNRV–Valuation Account) Presented below is information related to Knight Enterprise Jan. 31 Feb. 28 Mar. 31 Apr. 30 Inventory at cost Inventory at NRV Purchases for the month $15,000 $15,100 $17,000 15,600 $14,000 14,500 12,600 13,300 17,000 24,000 35,000 26,500 40,000 Sales for the month 29,000 Instructions a. From the information, prepare (as far as the data permit) monthly income statements in column? form for February, March, and April. The inventory is to be shown in the statement at cost; the gai or loss due to NRV market fluctuations is to be shown separately (using a valuation account). b. Prepare the journal entry required to establish the valuation account at January 31 and entries adjust it monthly thereafter.
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