ACCOUNTING ANALYSIS

[Name of the Institute]

Accounting Analysis

Question # 1

Answer.

Sales from woods and the moon = 35000

Beginning Inventory = 11000

COGS = cost *Quantity

11000/1+21800/4+31200/6+4000/12= 21983.33

21983.33+11000-Ending inventory=21983

Ending Inventory=11000

Sales-COGs =Gross Profit

35000-21983=13017

Question # 2.

Units available to sale is 300 + 1500= 1800 units

FIFO method

Units available to saleBeginning inventory 300 unit under each method

Beginning + Purchases - Ending Inventory = COGS300+1500-400=COGS

1400 units*cost =COGs

400*50= 20,000 COGSUnits available to sale = 400 units

400*50 = 20,000

Ending inventory = 400 units*50 =20,000

LIFO

Beginning Inventory =300*40

COGS

BEG+ Purchase-Ending=COGS

(300*40)+ (700*44) + (800*50)-(400)

Out of 400 units

(300*40)+ (100*44) =Ending Inventory

COGS under LIFO 75200

Units available to sale =400 units. The cost of the units is 75200

Weighted Average Method

Units available to sale = 1800 units

Cost of the units 82800

Average unit cost = 82800/1800= 46

Ending Inventory = 400*46 = 18400

Question # 3.

Answer.

A.

Inventory 2000

Payable2000

Acc. Receivables2550

Sales2550

C .ending inventory 125 *4 500

Return on the account 75*4 300

Inventory 200*4 800

B.

Purchase account is the account in which all the material that is being purchased is recorded. In the firm the absence of the purchase account is not recorded as the inventory which was unsold was returned back on account which affected the units in the inventory, initially it was 200 units but after the return on the account the available units in the inventory are 125 which cost only 500$. Hence it affected the accounting system of the firm.

Question 4

Answer.

A.

FIFO

COGS

(100*125+50*130+246*140+314*150)

12500+6500+34440+47100=100540

Ending inventory

(400-314=86)*150+74*160=129000+11840=24740

Gross Profit

Sales =710*250=177500

Less Cost of Goods sold =100540

1/3:

Purchase 100 boards @ $125

3/17:

Sold 50 boards @ $130

5/9:

5/9: 246 boards @140

7/3:

400 boards @ $150

10/23:

74 boards @ $160

LIFO

COGS

Purchase

LIFO

74

160

11840

400

150

60000

236

140

33040

Sales

710

104880

Ending Inventory

100

125

12500

50

130

6500

10

140

1400

160

20400

Purchases +beginning-Ending=COGs

COGS

710 units

Purchase and beginning

870

125280

Ending Inventory

160

20400

COGS

710

104880

Sales

710

250

177500

COGS

710

104880

Gross Profit

72620

Weighted Average

Unit's Available 870 units

Average Cost of the units 250

Cost of the Ending Inventory 160*250 =40000

Sales - COGS =Gross Profit

50 - 104880 = 72620 B.

a. In order to produce an up to date inventory valuation on the balance sheet perpetual inventory system is best because under the perpetual inventory system accurate financial statement is made and also the intensive management managers their inventory with respect to the sales. b. In the approximation of the physical flow of gravel dealer and sand the perpetual inventory can be used best because of the accuracy of the financial statement and inventory system. c. In reporting the law earning for separate electronics company that was experiencing the decline in the purchase price, the periodic (Ballard,1996) inventory system is good to choose because the periodic inventory system requires the adjustment in the statement which ...