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mid2-2008+Fall-SOL

# mid2-2008+Fall-SOL - \$2,500 – \$500 = \$2,000 c Liability...

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UGBA102A Exam 2 – Answer Key FALL 2008 MULTIPLE CHOICE: 1. b 2. c 3. d 4. c 5. a 6. c 7. a 8. d 9. b 10. e PROBLEM 1 a. (350 units x \$14) + (150 units x \$12) + (250 units x \$12) = \$9,700 b. Ending inventory in units = 200 + 450 + 350 – 250 – 500 = 250 250 units x \$12.50 = \$3,125 Weighted average cost: (200 units x \$11) + (450 units x \$12) + (350 units x \$14) = \$12,500 = \$12.50 (200 + 450 + 350 units) 1,000 units c. Cost of goods sold – LIFO \$100 million Less: Increase in LIFO reserve 1 Cost of goods sold – FIFO \$ 99 million PROBLEM 2 a. Bad debt expense 10,000 Allowance for doubtful accounts 10,000 (\$1,000,000 x .1%) b. Bad debt expense 2,000 Allowance for doubtful accounts 2,000 (\$100,000 x 1%) + (\$10,000 x 5%) + (\$5,000 x 20%) = \$2,500

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Unformatted text preview: \$2,500 – \$500 = \$2,000 c. Liability – Sales returns 200 Accounts receivable 200 Page 1 of 2 UGBA102A Exam 2 – Answer Key FALL 2008 PROBLEM 3 a. \$1,450 + [(\$100 x (1 - .30)] = 16.0% [(\$5,100 + \$4,100) + (\$5,300 + \$4,500)] / 2 b. \$4,500 / \$5,300 = 84.9% c. \$7,500 = 20 times (\$400 + \$350) /2 d. \$35 / \$2 = 17.5 PROBLEM 4 a. Year 1: (\$400,000 / 20 years) x 2 = \$40,000 Year 2: ((\$400,000 – \$40,000) / 20 years) x 2 = \$36,000 b. Accumulated depreciation (\$45,000 – \$5,000) x 8 years / 10 years 32,000 Loss on disposal of asset 13,000 Asset 45,000 c. Repair and maintenance expense 2,000 Cash 2,000 Page 2 of 2...
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