Exam #3 - Ch. 5-6

A company has the following per unit original costs and replacement costs for its inventory: Part A: 50 units with a cost of $5 and replacement cost of $4.50. Part B: 75 units with a cost of $6 and replacement cost of $6.50. Part C: 160 units with a cost of $3 and replacement cost of $2.50. Under the lower of cost or market method, the total value of this company's ending inventory must be reported as:

$1,075.00 50 x $4.50 = $225 75 x $6 = $450 160 x $2.50 = $400 Total: $1075

A company has inventory of 10 units at a cost of $10 each on June 1. On June 3, they purchased 20 units at $12 each. 12 units are sold on June 5. Using the FIFO periodic inventory method, what is the cost of the 12 units that were sold?

$124 10 x $10 = $100 2 x $12 = $24 Total: $124

Fluffy Pet Grooming deposits all cash receipts on the day when they received an all cash payments are made by check. At the close of business on June 30, its Cash account shows a $14,811 debit balance. Fluffy Pet Grooming's June 30 bank statement shows $14,472 on deposit in the bank prepare a bank reconciliation for fluffy pet grooming using the following information: A. Outstanding checks as of June 30 total $2261. B. The June 30 bank statement included a $75 debit memorandum for bank services. C. Check No. 919, listed with the canceled checks, was correctly drawn for $789 in payment of a utility bill on June 15. Fluffy Pet Grooming mistakenly recorded it with a debit to Utilities Expense and a credit to Cash in the amount of $798. D. The June 30 cash receipts of $2534 replaced in the banks night depository after banking hours and we're not recorded on the June 30 bank statement. What is the adjusted bank balance?

$14, 745

A company uses a weighted-average perpetual inventory system. August 2: 10 units were purchased at $12 per unit. August 18: 15 units were purchased at $15 per unit. August 29: 20 units were sold. August 31: 14 units were purchased at $16 per unit. What is the per-unit value of ending inventory on August 31?

$15.42

Acme-Jones Corporation uses a LIFO perpetual inventory system. August 2, 25 units were purchased at $12 per unit. August 5, 10 units were purchased at $13 per unit. August 15, 12 units were sold at $25 per unit. August 18, 15 units were purchased at $14 per unit. What was the amount of the cost of goods sold?

$154.00

Acme-Jones Corporation uses a weighted-average perpetual inventory system. August 2, 10 units were purchased at $12 per unit. August 18, 15 units were purchased at $14 per unit. August 29, 12 units were sold. What was the amount of cost of goods sold for the sale?

$158.40

A company uses the periodic inventory system and had the following activity during the current monthly period: November 1: beginning inventory 100 units at $20 November 5: purchased 100 units at $22 November 8: purchased 50 units at $23 November 16: sold 200 units at $45 November 19: purchased 50 units at $25 Using the weighted-average inventory method, the company's ending inventory would be reported at:

$2,200

Given the following information, determine the cost of ending inventory at June 30 using the LIFO perpetual inventory method. Assume this is the first month of the company's operations. June 1: 15 units were purchased at $20 per unit. June 15: 12 units were sold. June 29: 8 units were purchased for $25 per unit.

$260

A company had inventory on November 1 of 5 units at a cost of $20 each. On November 2, they purchased 10 units at $22 each. On November 6, they purchased 6 units at $25 each. On November 8, 8 units were sold for $55 each. Using the LIFO perpetual inventory method, what was the value of the inventory on November 8 after the sale?

$276

Given the following information determine the cost of goods sold at December 31 using the LIFO periodic inventory method: December 2: 5 units were purchased at $7 per unit. December 9: 10 units were purchased at $9.40 per unit. December 11: 12 units were sold at $35 per unit. December 15: 20 units were purchased at $10.15 per unit. December 22: 18 units were sold at $35 per unit.

$297 20 x $10.15 = $203 10 x $9.40 = $94 Total: $297

A company had inventory on November 1 of 5 units at a cost of $20 each. On November 2, they purchased 10 units at $22 each. On November 6, they purchased 6 units at $25 each. On November 8, 8 units were sold for $55 each. Using the weighted-average perpetual inventory method, what was the value of the inventory on November 30?

$299.33

A company had the following purchases during the current year: Jan: 10 units at $120 Feb. 20 units at $130 May: 15 units at $140 Sept. 12 units at $150 Nov. 10 units at $160 On December 31, there are 26 units remaining in ending inventory. These 26 units consisted of two from January, four from February, six from May, four from September and 10 from November. Using the specific identification method, what is the cost of the ending inventory?

$3,800

A company had inventory on November 1 of 5 units at a cost of $20 each. On November 2, they purchased 10 units at $22 each. On November 6, they purchased 6 units at $25 each. On November 8, 8 units were sold for $55 each. Using the FIFO perpetual inventory method, what was the value of the inventory on November 8 after the sale?

$304

A company had inventory at 5 units at a cost of $20 each on November 1. On November 2, they purchased 10 units at $22 each. On November 6, they purchased 6 units at $25 each. On November 8, they sold 18 units for $54 each. Using the LIFO perpetual inventory method, what was the cost of the 18 units sold?

$410 6 x $25 = $150 10 x $22 = $220 2 x $20 = $40 Total: $410

A corporation uses a LIFO perpetual inventory system. August 2, 25 units were purchased at $12 per unit. August 5, 10 units were purchased at $13 per unit. August 15, 12 units were sold at $25 per unit. August 18, 15 units were purchased at $14 per unit. What was the amount of the inventory for the month of August?

$486.00

A corporation uses a FIFO perpetual inventory system. August 2, 25 units were purchased at $12 per unit. August 5, 10 units were purchased at $13 per unit. August 15, 12 units were sold at $25 per unit. August 18, 15 units were purchased at $14 per unit. What was the amount of the inventory for the month of August?

$496.00

Toys "R" Us had cost of goods sold at $9,421 million, ending inventory of $2089 million, and average inventory at $1965 million. The inventory turnover equals:

4.79

In comparing the canceled checks on the bank statement with the entries in the accounting records, it is found that check number 4239 for November's rent was correctly written and drawn for $3,790 but was erroneously entered in the accounting records as $7,390. When reconciling the November bank statement, the company should:

???

Assume that the custodian of a $450 petty cash fund has $62.50 in coins and currency plus $382.50 in receipts at the end of the month. The entry to replenish the petty cash fund will include:

A credit to Cash for $387.50

The company made a bank deposit on September 30 that did not appear on the bank statement dated September 30. And preparing the September 30 bank reconciliation, the company should:

Add the deposit to the bank statement balance.

Merchandise inventory includes:

All goods owned by a company and held for sale.

Goods on cosignment

Are goods shipped by the owned to the cosignee who sells the goods for the owner

Cash equivalents:

Are short-term investments sufficiently close to their maturity date that their value is not sensitive to interest rate changes.

At the end of the day, the cash register's record shows $1250, but the count of cash in the cash register is $1245. The correct entry to record the cash sales for the day is:

Cash 1,245 Cash Over and Short 5 Sales

At the end of the day, the cash register's record shows $1000 but the count of cash in the register is $1035. The proper entry to record this excess includes a:

Credit to Cash Over and Short for $35

A company had $43 missing from petty cash which was not accounted for by petty cash receipts. The correct procedure is to:

Debit Cash Over and Short for $43.

What one below is the appropriate journal entry to record a Notes Receivable collection made by the bank?

Debit to cash $9452 debit to collection expense $48 credit notes receivable $9500.

On a bank reconciliation, an unrecorded debit memorandum for printing checks is:

Deducted from the book balance of cash.

The number of days' sales uncollected is calculated by:

Dividing accounts receivable by net sales and then multiplying by 365

When two clerks share the same cash register, which internal control principle is violated?

Establish responsibilities

Which inventory valuation method assigns a value to the inventory on the balance sheet that approximates current cost and also mimics the actual flow of goods for most businesses?

FIFO

Prenumbered printed checks are an example of which internal control principle?

Maintain adequate records

A company's internal control system:

Monitors and controls business activities.

Fluffy Pet Grooming deposits all cash receipts on the day when they received an all cash payments are made by check. At the close of business on June 30, its Cash account shows a $14,811 debit balance. Fluffy Pet Grooming's June 30 bank statement shows $14,472 on deposit in the bank prepare a bank reconciliation for fluffy pet grooming using the following information: A. Outstanding checks as of June 30 total $2261. B. The June 30 bank statement included a $75 debit memorandum for bank services. C. Check No. 919, listed with the canceled checks, was correctly drawn for $789 in payment of a utility bill on June 15. Fluffy Pet Grooming mistakenly recorded it with a debit to Utilities Expense and a credit to Cash in the amount of $798. D. The June 30 cash receipts of $2534 replaced in the banks night depository after banking hours and we're not recorded on the June 30 bank statement. What is the adjusting journal entry required as a result to record the increase in cash for the adjusted bank balance?

No adjusting entry is necessary

For which item does a bank NOT issue a debit memorandum?

To notify a depositor of a deposit to their account

A set of procedures and approvals that is designed to control cash disbursements and the acceptance of obligations is referred to as a(n):

Voucher system

Outstanding checks refer to checks that have been:

Written, recorded on the company books, sent to the customer, supplier, or creditor but not yet paid by the bank.

In applying the lower of cost or market method to inventory valuation, market is defined as:

current replacement cost

The internal document prepared by a department manager that informs the purchasing department of its needs is the:

purchase requisition

The internal document that is prepared to notify the appropriate persons that ordered goods have been received and describes the quantities and condition of the goods is the

receiving report