Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period. The estimated cost of goods sold, gross profit, and ending inventory for the recent three years.

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Answer 1

Question

Chapter 10, Problem 10.12P

a.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The estimated cost of goods sold, gross profit, and ending inventory for the recent three years.

b.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The estimated cost of goods sold, gross profit, and ending inventory for the recent two years.

c.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The difference based on 2-year and 3-year historical gross profit percentages.

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Wesley's Towing ServiceCorrected Trial BalanceSeptember 30, 20XX Account Title Debit Credit Cash $37,421 Accounts Receivable $970 Supplies $200 Prepaid Insurance $2,300 Equipment $10,000 Accounts Payable $5,000 Wesley, Capital $20,500 Wesley, Drawing $320 Repair Fees $9,000 Wages Expense $6,500 Rent Expense $1,400 Advertising Expense $450 Utilities Expense $500 Total $58,761 $58,761 Cash: The debit balance of Cash is $37,421, as given in the problem. Accounts Receivable: The debit balance of Accounts Receivable is $970, as given in the problem. Supplies: The debit balance of Supplies is $200, as given in the problem. Prepaid Insurance: The debit balance of Prepaid Insurance is $2,300, as given in the problem. Equipment: The debit balance of Equipment is $10,000, as given in the problem. Accounts Payable: The credit balance of Accounts Payable is $5,000. This is because the problem states that a $500 payment to a creditor…

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Answer 2

Question

Chapter 10, Problem 10.12P

a.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The estimated cost of goods sold, gross profit, and ending inventory for the recent three years.

b.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The estimated cost of goods sold, gross profit, and ending inventory for the recent two years.

c.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The difference based on 2-year and 3-year historical gross profit percentages.

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Answer 3

Question

Chapter 10, Problem 10.12P

a.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The estimated cost of goods sold, gross profit, and ending inventory for the recent three years.

b.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The estimated cost of goods sold, gross profit, and ending inventory for the recent two years.

c.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The difference based on 2-year and 3-year historical gross profit percentages.

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Answer 4

Question

Chapter 10, Problem 10.12P

a.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The estimated cost of goods sold, gross profit, and ending inventory for the recent three years.

b.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The estimated cost of goods sold, gross profit, and ending inventory for the recent two years.

c.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The difference based on 2-year and 3-year historical gross profit percentages.

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Answer 5

Chapter 10, Problem 10.12P

a.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The estimated cost of goods sold, gross profit, and ending inventory for the recent three years.

b.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The estimated cost of goods sold, gross profit, and ending inventory for the recent two years.

c.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The difference based on 2-year and 3-year historical gross profit percentages.

Answer 6

Chapter 10, Problem 10.12P

a.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The estimated cost of goods sold, gross profit, and ending inventory for the recent three years.

Answer 7

Chapter 10, Problem 10.12P

a.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The estimated cost of goods sold, gross profit, and ending inventory for the recent three years.

Answer 8

b.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The estimated cost of goods sold, gross profit, and ending inventory for the recent two years.

Answer 9

b.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The estimated cost of goods sold, gross profit, and ending inventory for the recent two years.

Answer 10

c.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The difference based on 2-year and 3-year historical gross profit percentages.

Answer 11

c.

To determine

Concept Introduction:

Gross profit method: This method estimates the ending inventory balance, in which companies perform a physical count of inventory at the end of the fiscal year. This method estimates the inventory value by using the historical percentage of gross profit with the information of net sales and the cost of goods available for sale during the current period.

The difference based on 2-year and 3-year historical gross profit percentages.

Answer 12

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Answer 13

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Answer 14

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Answer 15

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