income tax?Taking InventoryAt the end of the last fiscal period, employees for Trans-Canada Distributorscounted all merchandise on hand. However, a complete section of the warehousewas missed when the inventory was taken. The cost of the merchandise that wasnot included in the ending inventory figure was $7500.Questions1. What effect has this error on the income statement and on the balancesheet this year?2. If the error went undiscovered, would the net income in the secondyear 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-yearbalance sheet? Explain your answer.©P

Physical stock taking is done at the end of every accounting year. Under this process, each and…

Taking Iventory At the end of the last fiscal period, er counted all merchandise on hand. How was missed when the inventory was tak not included in the ending inventory fi Questions 1. What effect has this error on the in sheet this year? 2. If the error went undiscovered, wc year be too high or too low? 3. Over the two-year period, what is (assuming the second year's inven 4. Is the owner's equity total correct balance sheet? Explain your answ

Taking Iventory At the end of the last fiscal period, er counted all merchandise on hand. How was missed when the inventory was tak not included in the ending inventory fi Questions 1. What effect has this error on the in sheet this year? 2. If the error went undiscovered, wc year be too high or too low? 3. Over the two-year period, what is (assuming the second year's inven 4. Is the owner's equity total correct balance sheet? Explain your answ

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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Assume the perpetual inventory system is used unless stated otherwise. Round all numbers to the nearest whole dollar unless stated otherwise. Estimating sales returns On December 31, Jack Photography Supplies estimated that approximately 2% of merchandise sold will be returned. Sales Revenue for the year was $80,000 with a cost of $48,000. Journalize the adjusting entries needed to account for the estimated returns.
Madison Company's perpetual inventory records indicate that $531,630 of merchandise should be on hand on October 31. The physical inventory indicates that $508,250 is actually on hand. Journalize the adjusting entry for the inventory shrinkage for Madison Company for the year ended October 31. If an amount box does not requíre an entry, leave it blank. Oct. 31
Oriole Company's record of transactions concerning part WA6 for the month of September was as follows. Purchases September 1 (balance on hand) 3 (a1) نا 12 292 2 16 300 200 @ 300 @ 300 @ 500 @ 300 @ $13.00 Average-cost per unit $ @ 13.10 13.25 13.30 13.30 13.40 Sales September 4 17 27 30 400 600 300 200 Calculate average-cost per unit. Assume that perpetual inventory records are kept in units only. (Round answer to 2 decimal places, eg. 2.76.)
r 个 O any purchased inventory for $2,500 from a vendor on account, FOB shipping point, with terms of 2/10, n/30. The company paid the shipper $100 cash for freight in. The company then returned damaged goods worth $500. The invoice was then paid eight days after the invoice date. Assuming that there was no beginning inventory balance, the cost of inventory would be (Assume a perpetual inventory system.) OA. $1,960 B. $2,060 OC. $2.400 S
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1. Express the balance sheets in common-size percents. 2. Assuming annual sales have not changed in the last three years, is the change in accounts receivable as a percentage of total assets favorable or unfavorable? 3. Assuming annual sales have not changed in the last three years, is the change in merchandise inventory as a percentage of total assets favorable or unfavorable? Complete this question by entering your answers in the tabs below. Req 1 Req 2 and 3 Express the balance sheets in common-size percents. (Do not round intermediate calculations and round your final percentage answers to 1 decimal place.) Assets Cash Accounts receivable, net Merchandise inventory Prepaid expenses Plant assets, net Total assets Common-Size Comparative Balance Sheets December 31 Liabilities and Equity Accounts payable SIMON COMPANY Long-term notes payable Common stock, $10 par Retained earnings Total liabilities and equity Current Year % % % % 1 Year Ago 2 Years Ago
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The perpetual inventory records of Penny Co. indicate that $415,000 of merchandise should be on hand on December 31. The physical inventory indicates that $370,000 of merchandise is actually on hand. Journalize the adjusting entry for the inventory shrinkage for the year ended December 31.
On August 31, 2010, Harvey Co. decided to change from the FIFO periodic inventory system to the weightedaverage periodic inventory system. Harvey is on a calendar year basis. The cumulative effect of the change is determineda. As of January 1, 2010.b. As of August 31, 2010. c. During the eight months ending August 31, 2010, by a weighted-average of the purchases.d. During 2010 by a weighted-average of the purchases.
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