Southern Distributors, Incorporated, supplies ice cream shops with various toppings for making sundaes.On November 17, 2024, a fire resulted in the loss of all of the toppings stored in one section of thewarehouse. The company must provide its insurance company with an estimate of the amount ofinventory lost. The following information is available from the company's accounting records:Inventory, January 1, 2024Net purchases through November 17Net sales through November 17Historical gross profit ratioFruitToppingsRequired:1. Calculate the estimated cost of each of the toppings lost in the fire.MarshmallowChocolateFruitToppings$ 24,000170,000220,000Estimated cost of lostInventory20%MarshmallowToppings$ 7,40040,00059,00030%ChocolateToppings$3,40012,40020,40030%

Gross profit is the difference between sales revenue and cost of goods sold. The cost of goods sold…

Answered: Southern Distributors, Incorporated,…

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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Stallman Company took a physical inventory on December 31 and determined that goods costing $200,000 were on hand. Not included in the physical count as $25,000 of gods purchased from Pelzer Corporation, f.o.b. shipping point and $22,000 of goods sold to Alvarez Company for $30,000 f.o.b. destination. Both the Pelzer purchase and the Alvarez sale were reported in transit at year end. What amount should Stallman report as its December 31, intentory? O $220,000 O $200,000
The following transactions are for Angela’s Disc Golf Emporium: (1) In December, customers purchased $3,000 of gift cards from Angela’s. (2) At December 31, gift cards totaling $1,900 remained unused. (3) Angela’s took a physical count of its inventory and determined the correct value of inventory should be $20,000. The unadjusted balance in the Inventory account was $20,450. Prepare journal entries for the three transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) No. Account Titles and Explanation Debit Credit (1) Cash 3000 Unearned Sales Revenue 3000 (2) Unearned Sales Revenue 1100 Sales Revenue 1100 (3) Cost Of Goods Sold 450 Inventory 450 What is reported in the income statement as a result of items (1) and (2) above? Sales Revenue is increased by $ , increasing net income.
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BAYWEST Stationery & Supplies located in Montego Bay, Jamaica, sells a variety of school supplies including several brands of tablets. The business uses a perpetual inventory system and adjusts cost of goods sold for any shortage or excess inventory. BAYWEST began the third quarter (July to September) of 2020 with 30 (Alcatel) tablets at a total cost of $187,800. During the quarter, with the onset of the COVID-19 pandemic, the business completed the following transactions relating to the “Alcatel” tablets. July 8 : 98 tablets were purchased at a cost of $6,202 each. In addition, the business paid a freight charge of $248 cash on each tablet to have the inventory shipped from the point of purchase to their warehouse. July 31: The sales for July were 85 tablets which yielded total sales revenue of $809,030. (25 of these tablets were sold on account to longstanding customers) August 4: A new batch of 67 tablets was purchased at a total cost of $465,650…
Two different companies, Quick Cleaners and JunkTrader entered into the following inventory transactions during December. Both companies use a perpetual inventory system. • December 3 - Quick Cleaners sold inventory on account to JunkTrader for $550,000, terms 3/10, n/30. This inventory originally cost Quick Cleaners $330,000. . December 8 - JunkTrader returned inventory to Quick Cleaners for a credit of $20,000. Quick Cleaners returned this inventory to inventory at its original cost of $12,000. December 23 - JunkTrader paid Quick Cleaners for the amount owed. Required: Prepare the journal entries to record these transactions on the books of Quick Cleaners using the gross method. Use the MSWord link for the table to write your journal entries. After you have written the journal entries on the table in the MSWord document provided, type in your name below the table on the document, save the document and then upload it to this problem in the upload space provided at the bottom of this…
E6.18 modified The inventory of Ipswich Books was destroyed by fire on March 1. From an examination of the accounting records, the following data for the first two months of the year are obtained: Sales revenue $51,000, Sales returns and allowances $1,000, Purchases $31,200, Freight-in $1,200, and Purchase returns and allowances $1,800. Determine the merchandise lost by fire, assuming: a. A beginning inventory of $20,000 and a gross profit rate of 40% on net sales. b. A beginning inventory of $30,000 and gross profit rate of 25% on cost
PROBLEM 2. On September 30, 2021, a fire at Uranus Company's only warehouse caused severe damage to its entire inventory. Based on recent history, Uranus has a gross profit of 25% on sales. The following information is available from Uranus's records for the nine months ended September 30, 2021. Inventory, January 1, 2020-P 300,000; Net Purchases- P 4,200,000; Net sales- P 3,540,000. A physical inventory disclosed usable damaged goods which Uranus estimates can be sold to a jobber for P 50,000 2. Using the gross profit method, what is the estimated cost of merchandise lost by the fire?
15.Your review of ABC Company's inventory and related records for the year revealed the following information:Inventory, 1/1 - 450,000Purchases -3,150,000Sales -4,200,000You conducted a physical inventory on December 31 and determined P450,000 was in the company's warehouse. The management suspects some new employees may have pilfered a portion of the merchandise inventory.What is the cost of the missing inventory assuming that ABC's gross profit remains at 30% of sales?
income tax? Taking Inventory At the end of the last fiscal period, employees for Trans-Canada Distributors counted all merchandise on hand. However, a complete section of the warehouse was missed when the inventory was taken. The cost of the merchandise that was not included in the ending inventory figure was $7500. Questions 1. What effect has this error on the income statement and on the balance sheet this year? 2. If the error went undiscovered, would the net income in the second year be too high or too low? 3. Over the two-year period, what is the total error in the net income (assuming the second year's inventory is done correctly)? 4. Is the owner's equity total correct or incorrect in the second-year balance sheet? Explain your answer. ©P

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