Concept explainers
2. Net income, $185,000
Appendix 2
PR 5-10A Periodic inventory accounts, multiple-step income statement, closing entries
On December 31, 20Y5, the balances of the accounts appearing in the ledger of Wyman Company are as follows:
Instructions
1. Does Wyman Company use a periodic or perpetual inventory system? Explain.
2. Prepare a multiple-step income statement for Wyman Company for the year ended December 31, 20Y5. The inventory as of December 31, 20Y5, was $305,000. The estimated cost of customer returns inventory for December 31, 20Y5, is estimated to increase to $40,000.
3. Prepare the closing entries for Wyman Company as of December 31, 20Y5.
4. What would be the net income if the perpetual inventory system had been used?
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Chapter 5 Solutions
Financial And Managerial Accounting
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- Inventory by three cost flow methods Details regarding the inventory of appliances on January 1, 20Y7, purchases invoices during the year, and the inventory count on December 31. 2O’7. of Amsterdam Appliances are summarized as follows: Instructions Determine the cost of the inventory on December 31, 20Y7, h the average cost method, using the columnar headings indicated in (1).arrow_forward( Appendix 6B) Inventory Costing Methods: Periodic System Harrington Company had the following data for inventory during a recent year: Assume that Harrington uses a periodic inventory accounting system. Required: 1. Using the FIFO, LIFO, and average cost methods, compute the ending inventory and cost of goods sold. ( Note: Use four decimal places for per-unit calculations and round all other numbers to the nearest dollar.) 2. CONCEPTUAL CONNECTION Which method will produce the most realistic amount for income? For inventory? 3. CONCEPTUAL CONNECTION Which method will produce the lowest amount paid for taxes?arrow_forwardPERPETUAL: LIFO AND MOVING-AVERAGE Kelley Company began business on January 1, 20-1. Purchases and sales during the month of January follow. REQUIRED Calculate the total amount to be assigned to cost of goods sold for January and the ending inventory on January 31, under each of the following methods: 1. Perpetual LIFO inventory method. 2. Perpetual moving-average inventory method.arrow_forward
- Selected transactions for Essex Company during July of the current year are listed in Problem 6-3B. Instructions Journalize the entries to record the transactions of Essex Company for July using the periodic inventory system.arrow_forwardInventory by three cost flow methods Details regarding the inventory of appliances on January 1, 20Y7, purchases invoices during the year, and the inventory count on December 31. 2O’7. of Amsterdam Appliances are summarized as follows: Instructions Determine the Cost of the inventory on December 31, 20Y7, by the last-in. first-out method, following the procedures indicated in (1).arrow_forwardJOURNALIZE ADJUSTING ENTRY FOR A MERCHANDISING BUSINESS: PERPETUAL INVENTORY SYSTEM On December 31, Anup Enterprises completed a physical count of its inventory. Although the merchandise inventory account shows a balance of 200,000, the physical count comes to 210,000. Prepare the appropriate adjusting entry under the perpetual inventory systemarrow_forward
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