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Javate - 3rd Activity

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27 views4 pages

Javate - 3rd Activity

Uploaded by

Prime Javate
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Problem 1.

1.

Factory Supplies 31,000

Office Supplies 13,000

Goods Sold FOB Destination that are in transit at Dec. 31 54,000

Cost identified with units completed but not yet sold 310,000

Raw materials still in process 265,000

Goods out on consignment from another entity 755,000

Goods sold on installment basis 122,000

Materials on hand not yet placed into production 416,000

Goods purchased FOB Shipping point that are in transit at Dec 31 128,000

Goods sold FOB shipping point that are in transit December 31 98,000

Inventory December 31, 2021 2,182,000

2.

 Goods sold were large returns are expected to happen - It appears as a deduction in inventory
account due to decrease of inventory due to sale. It will appear in Cost of Goods Sold.
 Short term equity and bond investments that will be resold in the near future - It is a short-term
investment in stocks so it is not reported under inventory
 Goods held on consignment from another entity - These are reported as consignment goods
because these are held on temporary purpose but the consignor reports it as inventory but the
not consignee.
 Expenses incurred to advertise goods held for resale - These are not part of inventories as these
are costs incurred in order to sell the goods.
 Interest expense - These interest costs are not treated as inventory as these are expenses.
 Factory Labor Cost – these are not inventory, because these are expenses in making goods.
 Freight charge on goods purchased - These are not reported as inventory because these are
charges levied during the purchase of inventory.
 Goods purchased FOB destination that are in transit December 31 - The seller reports as
inventory but the buyer is not responsible until the goods reaches to the buyer. Hence, these
are not reported as inventory.
 Goods sold to another entity, for which our company has signed an agreement - These are not
part of inventories as these are costs incurred in order to sell the goods.

Problem 2.
Physical Counts 5,500,000
300,000
Inventory, December 31 5,800,000
Problem 3.
Accounts Payable balance 2,300,000
Goods shipped lost in transit 40,000
Purchase return (70,000)
Advance payment (error) 500,000
Accounts Payable ending balance 2,770,000

Problem 4.
1. FIFO method
From Jan 5 6,000 * 180 = 1,080,000
From Jan 26 2,000 * 200 = 4,000,000
Ending inventory 5,080,000

Inventory, Beg. 1,500,000


Purchases 1,800,000
400,000 2,200,000
Goods Available for sale 3,700,000
Less: Inventory, End 1,480,000
Cost of Goods Sold 2,220,000
2. Weighted Average Method
UNITS Total Costs
Jan 1 Beginning 10,000 1,500,000
5 Purchases 10,000 1,800,000
25 Purchases 4,000 800,000
26 Purch Return 2,000 (400,000)
22,000 3,700,000
Weighted average cost per unit:
3,700,000/22,000 = 168.181818
Cost of ending inventory:
8,000 * 168.181818 = 1,345,454.54544
3. Moving Average
UNITS UNIT COST TOTAL COST
Balance 10,000 150 1,500,000
Purchases 10,000 180 1,800,000
20,000 165 3,300,000
Sales 15,000 165 2,475,000
Balance 5,000 165 825,000
Sales Return 1,000 165 165,000
6,000 165 990,000
Purchase 4,000 200 800,000
10,000 179 1,790,000
Purchase Return (2,000) 200 400,000
Ending Inventory 8,000 173.75 1,390,000
4. 1,390,000/8,000 = 173.75

Problem 5
Cost Retail
Beginning Inventory 650,000 1,200,000
Purchases 4,000,000 14,700,000
Freight in 200,000
Purchase return (300,000) 500,000
Purchase allowance (150,000)
Departmental transfer in 200,000 300,000
Net Mark up 300,000
GAS – conservative 9,600,000 16,000,000
Cost ratio (9,600,000/16,000,000) 60%
Net mark down (1,000,000)
GAS – average 9,600,000 15,000,000

Less: Sales 9,500,000


Employee discount 500,000
Estimated normal:
Shoplifting loss 600,000
Shrinkage 400,000 11,000,000
Ending inventory at retail 4,000,000

1. Conservative cost (4,000,000 60%) 2,400,000


2. Average cost (4,000,000 * 64%) 2,560,000

Problem 6
1.
2yrs old December – January
100 (10,500 – 10,000)
100 * 500 50,000
2.5 yrs old December – January
10 (11,100 – 10,800)

10 * 300 3,000

New born December – January

10 (7,200 – 7,000)

10 * 200 2,000

Gain from biological assets 55,000


2.

3yrs old December – January

100 (12,000 – 10,500)

100 * 1,500 150,000

3yrs old December – 2.5 yrs old Dec

10 (12,000 – 11,100)

10 * 900 9,000

0.5 yrs old December – new born Dec

10 (8,000 – 7,200)

10 * 800 8,000

New born animal on July 1

10 * 7,000 70,000

Gain from biological assets 237,000

3.

Fair Value of 100 animals on Jan 1 (100 * 10,000) 1,000,000

Acquisition cost of 10 animals on July (10 * 10,800) 108,000

Total carrying amount of biological assets 1,108,000

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