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10 points Russell Retail Group begins the year with inventory of $55,000 and ends the year with inventory of $29,000. During the year, the following amounts are recorded.

Purchases Purchase returns Purchase discounts Freight-in Freight-out

$ 190,000 20,000 13,000 36,000 21,000

Required: Calculate cost of goods sold for the year. (Omit the "$" sign in your response.)

Cost of goods sold


Worksheet

$
Difficulty: Medium Learning Objective: 06-2

[The following information applies to the questions displayed below.]

During 2010, TRC Corporation has the following inventory transactions. [cal2a]

Date Jan. 1 Apr. 7 Jul. 16 Oct. 6

Transaction Beginning inventory Purchase Purchase Purchase

Number of units 32 128 184 102 446

Unit cost $ 31 33 36 40

Total cost $ 992 4,224 6,624 4,080 $ 15,920

For the entire year, the company sells 376 units of inventory for $53 each and uses a periodic inventory system.

award:

10 points Requirement 1: Using FIFO, calculate (a) ending inventory, (b) cost of goods sold, (c) sales revenue, and (d) gross profit. (Omit the "$" sign in your response.)

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(a) (b) (c) (d)

Ending inventory Cost of goods sold Sales revenue Gross profit

$ $ $ $
Difficulty: Hard Learning Objective: 06-3

Worksheet

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10 points Requirement 2: Using LIFO, calculate (a) ending inventory, (b) cost of goods sold, (c) sales revenue, and (d) gross profit. (Omit the "$" sign in your response.)

(a) (b) (c) (d)

Ending inventory Cost of goods sold Sales revenue Gross profit

$ $ $ $

Worksheet

Difficulty: Hard

Learning Objective: 06-3

award:

10 points Requirement 3: Using average cost, calculate (a) ending inventory, (b) cost of goods sold, (c) sales revenue, and (d) gross profit. (Round the intermediate calculations to 2 decimal places. Round your answers to the nearest dollar amount. Omit the "$" sign in your response.)

(a) (b) (c) (d)

Ending inventory Cost of goods sold Sales revenue Gross profit

$ $ $ $
Difficulty: Hard Learning Objective: 06-3

Worksheet

award:

10 points Requirement 4: Which method will result in higher profitability when inventory costs are rising? (Click to select)

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Worksheet

Difficulty: Hard

Learning Objective: 06-3

[The following information applies to the questions displayed below.]

Littleton Books has the following transactions during May. May 2 Purchases books on account from Readers Wholesale for $1,600, terms 3/10, n/30. May 3 Pays freight costs of $280 on books purchased from Readers. May 5 Returns books with a cost of $300 to Readers because part of the order is incorrect. May 10 Pays the full amount due to Readers. May 30 Sells books purchased on May 2 (less those returned on May 5) for $2,800 on account.

award:

10 points Requirement 1: Record the transactions of Littleton Books, assuming the company uses a perpetual inventory system. (Omit the "$" sign in your response.)

Date May 2

General Journal (Click to select) (Click to select)

Debit

Credit

May 3

(Click to select) (Click to select)

May 5

(Click to select) (Click to select)

May 10

(Click to select) (Click to select) (Click to select)

May 30

(Click to select) (Click to select) (Click to select) (Click to select)

Worksheet

Difficulty: Medium

Learning Objective: 06-5

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10 points Requirement 2: Assume that payment to Readers is made on May 24 instead of May 10. Record this payment. (Omit the "$" sign in your response.).

Date May 24

General Journal (Click to select) (Click to select)

Debit

Credit

Worksheet

Difficulty: Medium

Learning Objective: 06-5

[The following information applies to the questions displayed below.]

Littleton Books has the following transactions during May. May 2 Purchases books on account from Readers Wholesale for $1,600, terms 2/10, n/30. May 3 Pays freight costs of $110 on books purchased from Readers. May 5 Returns books with a cost of $400 to Readers because part of the order is incorrect. May 10 Pays the full amount due to Readers. May 30 Sells books purchased on May 2 (less those returned on May 5) for $2,300 on account.

award:

10 points Requirement 1: Record the transactions of Littleton Books, assuming the company uses a periodic inventory system. (Omit the "$" sign in your response.) Date May 2 (Click to select) (Click to select) May 3 (Click to select) (Click to select) May 5 (Click to select) (Click to select) May 10 (Click to select) (Click to select) (Click to select) General Journal Debit Credit

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May 30

(Click to select) (Click to select)

Worksheet

Difficulty: Medium

Learning Objective: 06-5

award:

10 points Requirement 2: Record the period-end adjustment to cost of goods sold on May 31, assuming the company has no beginning or ending inventory. (Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.) Date May 31 General Journal (Click to select) (Click to select) (Click to select) (Click to select) (Click to select) (Click to select) (Click to select)
Worksheet Difficulty: Medium Learning Objective: 06-5

Debit

Credit

[The following information applies to the questions displayed below.]

A company like Golf USA that sells golf-related merchandise typically will have inventory items such as golf clothing and golf equipment. As technology advances the design and performance of the next generation of drivers, the older models become less marketable and therefore decline in value. Suppose that in 2010, Ping (a manufacturer of golf clubs) introduces the MegaDriver II, the new and improved version of the MegaDriver. Below are amounts related to Golf USA's inventory at the end of 2010. Inventory Shirts MegaDriver MegaDriver II Quantity 27 5 25 Cost $ 53 258 291 Market $ 61 211 314

award:

10 points Requirement 1: Calculate ending inventory under lower-of-cost-or-market. (Omit the "$" sign in your response.)

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Ending inventory
Worksheet

$
Difficulty: Medium Learning Objective: 06-7

award:

10 points Requirement 2: Record any necessary adjustment to inventory. (Omit the "$" sign in your response.) General Journal (Click to select) (Click to select) Debit Credit

Worksheet

Difficulty: Medium

Learning Objective: 06-7

award:

10 points Requirement 3: The write-down of inventory has the effects of reducing total assets (inventory), decreasing expenses (cost of goods sold), decreasing net income, and decreasing retained earnings. (Click to select)
Worksheet Difficulty: Medium Learning Objective: 06-7

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