ADVANCED ACCOUNTING
12th Edition
ISBN: 9780357671221
Author: FISCHER
Publisher: CENGAGE L
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Chapter 12, Problem 3E
To determine
Income
It tells the financial position of a position over a specific accounting period.
To calculate The preparation of income statement.
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Jones Company started the year with no inventory. During the year, it purchased two identical inventory items at different times. The
first purchase cost $1,170 and the other, $1,550. Jones sold one of the items during the year.
Required
Based on this information, how much product cost would be allocated to cost of goods sold and ending inventory on the year-end
financial statements, assuming use of
a. FIFO?
b. LIFO?
c. Weighted average?
Cost of goods sold
Ending inventory
$
FIFO
1,170
LIFO
$ 1.170
Weighted
Average
Following are independent cases. Please check the accounting treatments and given calculations wherever provided. Specifically, you are expected to COMMENT on whether the accounting treatment is correct or not. If you agree or disagree, Explain your answer and provide Calculations if needed.
A. During 2020, CEPS Company produced oil and recorded the production costs as inventory. At the end of the year, the accountant decided to report these inventories using the net realizable value approach. He reported an inventory of $1,050,000 which is higher than the cost.
B. In November 2020, North Oil Company sold 250 Mcf of gas with heat content of 1.040 MMBtu/Mcf and selling price of $4.20 per MMBtu. The company’s accountant reported total sales revenue of $1,050.
C. During 2020, National Company decided to shut-in a producing well and paid $2,000 per month during the months of March through May. These shut-in payments are not recoverable from future production. In March, National’s…
Halicon Ltd. applies the lower of cost or NRV valuation to inventory. The company's inventory at the end of
the year is as follows Required: Determine the amount of any adjustment that is required to inventory under
each of the following valuation methods: (Enter all amounts as positive values.) By individual type of item.
By class of inventory.
Chapter 12 Solutions
ADVANCED ACCOUNTING
Ch. 12 - Prob. 1UTICh. 12 - Prob. 2UTICh. 12 - Prob. 3UTICh. 12 - Prob. 4UTICh. 12 - Prob. 1.1ECh. 12 - Prob. 1.2ECh. 12 - Prob. 1.3ECh. 12 - Prob. 1.4ECh. 12 - Prob. 1.5ECh. 12 - Prob. 1.6E
Ch. 12 - Prob. 2ECh. 12 - Prob. 3ECh. 12 - Prob. 4.1ECh. 12 - Prob. 4.2ECh. 12 - Prob. 6ECh. 12 - Prob. 7ECh. 12 - Ratable allocation for nonordinary items. Baxter...Ch. 12 - Prob. 9.1ECh. 12 - Prob. 9.2ECh. 12 - Prob. 9.3ECh. 12 - Prob. 10ECh. 12 - Prob. 12.1PCh. 12 - Prob. 12.2PCh. 12 - Prob. 12.3PCh. 12 - Prob. 12.4PCh. 12 - Prob. 12.5PCh. 12 - Prob. 12.6PCh. 12 - Prob. 12.7.1PCh. 12 - Prob. 12.7.2PCh. 12 - Prob. 12.7.3PCh. 12 - Prob. 12.8.1PCh. 12 - Prob. 12.8.2P
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