Two or more items are omitted in each of the following tabulations of income statement data. Fill in the amounts that are missing.201920202021Sales revenue$290,000$410,000Sales returns and allowances(11,000)(13,000)Net sales347,000Beginning inventory20,00032,000Ending inventoryPurchases260,000298,000Purchase returns and allowances(5.000)(8,000)(10.000)Freight-in8,0009,00012.000Cost of goods sold(233,000)(293,000)Gross profit on sales46,00091,00097,000

Income statement: Income statement refers to the statement used for recording the revenue and…

Answered: Two or more items are omitted in each…

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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McLelland Inc. reported net income of $150,000 for 2019 and $165,000 for 2020. Early in 2020, McLelland discovers that the December 31, 2019 ending inventory was overstated by $7,700. For simplicity, ignore taxes. Required: 1. What is the correct net income for 2019? For 2020? Net Income 2019 2020 2. Assuming the error was not corrected, what is the effect on the balance sheet at December 31, 2019? At December 31, 2020? December 31, 2019 December 31, 2020
At year-end, IMMUTABLE Co reported inventory at P3,900,000. Allowance for inventory write-down before any adjustment is at P195,000. Product details are as follows: Historical Replacement Sales Net Realizable Normal Cost Cost Price Value Profit A 1,040,000 1,170,000 1,560,000| 715,000 325,000 1,300,000 1,560,000 1,690000| 1,430,000 195,00 C 910,000 1,300,000 1,625,000| 1,235,000 390,000 650,000 780,000 1,300,000 455,000 390,000 What amount of inventory write-down should be included in cost of goods sold?
4.
The ending merchandise inventory is overstated by $3,000. The effect on net income for the current period is to
Volata Company began operations on January 1, 2019. In the second quarter of 2020, it adopted the FIFO method of inventory valuation. In the past, it used the LIFO method. The company’s interim income statements as originally reported under the LIFO method follow: 2019 2020 1stQ 2ndQ 3rdQ 4thQ 1stQ Sales $ 29,000 $ 31,000 $ 33,000 $ 35,000 $ 37,000 Cost of goods sold (LIFO) 5,900 6,900 7,700 8,900 10,400 Operating expenses 3,900 4,100 4,500 4,900 5,100 Income before income taxes $ 19,200 $ 20,000 $ 20,800 $ 21,200 $ 21,500 Income taxes (25%) 4,800 5,000 5,200 5,300 5,375 Net income $ 14,400 $ 15,000 $ 15,600 $ 15,900 $ 16,125 If the FIFO method had been used since the company began operations, cost of goods sold in each of the previous quarters would have been as follows: 2019 2020 1stQ 2ndQ…
Volata Company began operations on January 1, 2019. In the second quarter of 2020, it adopted the FIFO method of inventory valuation. In the past, it used the LIFO method. The company’s interim income statements as originally reported under the LIFO method follow: 2019 2020 1stQ 2ndQ 3rdQ 4thQ 1stQ Sales $ 21,000 $ 23,000 $ 25,000 $ 27,000 $ 29,000 Cost of goods sold (LIFO) 5,100 6,100 6,900 8,100 9,600 Operating expenses 3,100 3,300 3,700 4,100 4,300 Income before income taxes $ 12,800 $ 13,600 $ 14,400 $ 14,800 $ 15,100 Income taxes (25%) 3,200 3,400 3,600 3,700 3,775 Net income $ 9,600 $ 10,200 $ 10,800 $ 11,100 $ 11,325 If the FIFO method had been used since the company began operations, cost of goods sold in each of the previous quarters would have been as follows: 2019 2020 1stQ 2ndQ…
Ajay
13, please answer the following question, thanks
As of January 1, 2020, Sandhill Inc. adopted the retail method of accounting for its merchandise inventory. To prepare the store's financial statements at June 30, 2020, you obtain the following data. Inventory, January 1 Markdowns Markups Markdown cancellations Markup cancellations Purchases Sales revenue Purchase returns Sales returns and allowances (a) Cost $28,100 94,560 2,900 Selling Price $43,500 11,000 9,200 6,000 3,000 153,800 154,200 3,900 7,500 Compute Sandhill's June 30, 2020, inventory under the conventional retail method of accounting for inventories. (Round ratios for computational purposes to O decimal places, e.g. 78% and final answer to O decimal places, e.g. 28,987.) Inventory under the conventional retail method $
2.2. During 2021, Gamma Ltd discovered that some of their products sold during 2020 were incorrectly included in inventory as 31 December 2020 at R6 500. Assume a tax rate of 30%. Assume that the prior period error effect is considered to be material. Gamma Ltd.'s accounting records are as follows: 2021 Sales Cost of sales Profit before tax 208 000 (173 500) 35 000 (10 500) 24 500 2020 147 000 (107 000) 40 000 (12 000) 28 000 Taxation Profit The profit for 2021 includes R13 500 for the error made in opening inventory Additional information: 2020 opening retained earnings was R40 000 and closing retained earnings was R68 000. Gamma's income tax rate was 30% in 2021 as well as in 2020. It had no other income or expenses. Gamma Ltd has R10 000 of share capital throughout 2020 and 2021, as well as retained earnings. REQUIRED: Disclose the effect of the error in the financial statements for the year ended 31 December 2021
Taylor Company uses a periodic inventory system. The following is partial information from its income statements for 2019 and 2020: Beginning inventory Sales Purchases Purchase returns Ending inventory Gross profit Cost of goods sold Expenses Net income 2019 $ (b) 250,000 115,000 2,000 50,000 (a) 101,000 60,000 (c) 2020 $ (d) (f) 140,000 3,000 70,000 83,000 (e) 62,000 21,000 Required Fill in the blanks lettered a through f. (Hint: It probably is easiest to work through the blanks according to the sequential letters.) (a) Gross profit (b) Beginning inventory (c) Net income (d) Beginning inventory of 2020 $ (e) Cost of goods sold (f) Sales
E8.6 (LO 2) (Determining Merchandise Amounts-Periodic) Two or more items are omitted in each of the following tabulations of income statement data. Fill in the amounts that are missing. 2019 2020 2021 Sales revenue $290,000 $ ? $410,000 Sales returns and allowances 11,000 13,000 ? Net sales 347,000 Beginning inventory Ending inventory 20,000 32,000 ? ? ? ? Purchases ? 260,000 298,000 Purchase returns and allowances 5,000 8,000 10,000 Freight-in Cost of goods sold Gross profit on sales 8,000 9,000 12,000 233,000 ? 293,000 46,000 91,000 97,000

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