ch 9 homework solutions

ch 9 homework solutions - EXERCISE 9-1 (15- 20 minutes)...

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EXERCISE 9-1 (15--20 minutes) Items 1, 3, 5, 7, 8, 11, 13, 14, 16, and 17 would be reported as inventory in the financial statements. The following items would not be reported as inventory: 2. Cost of goods sold in the income statement. 4. Not reported in the financial statements. 6. Cost of goods sold in the income statement. 9. Interest expense in the income statement. 10. Advertising expense in the income statement. 12. Office supplies in the current assets section of the balance sheet. 15. Not reported in the financial statements. 18. Temporary investments in the current assets section of the balance sheet. EXERCISE 9-3 (10--15 minutes) 1. Should be included. It has not been shipped yet. 2. Do not include. Title did not pass until January 3. 3. Include in inventory. Product belonged to client at December 31, 2008. 4. Include in inventory. Under invoice terms, title passed when goods were shipped. 5. Do not include. Goods received on consignment remain the property of the consignor. EXERCISE 9-9 (15--20 minutes)
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(a) Cost of Goods Sold Ending Inventory 1. LIFO 500 @ $13 = $ 6,500 300 @ $10 = $3,000 500 @ $12 = 6,000 300 @ $12 = 3,600 $12,500 $6,600 2. FIFO 300 @ $10 = $ 3,000 500 @ $13 = $6,500 700 @ $12 = 8,400 100 @ $12 = 1,200 $11,400 $7,700 (b) LIFO 100 @ $10 = $ 1,000 300 @ $12 = 3,600 200 @ $13 = 2,600 $ 7,200 (c) Sales $25,400 = ($24 X $200) + ($25 X $500) + ($27 X $300) Cost of Goods Sold 11,400 Gross Profit (FIFO) $14,000 Note: FIFO periodic and FIFO perpetual provide the same gross profit and inventory value. (d) LIFO matches more current costs with revenue. When prices are rising (as is generally the case), this results in a higher amount for cost of goods sold and a lower gross profit. As indicated in this exercise, prices were rising and cost of goods sold under LIFO was higher. EXERCISE 9-11 (15--20 minutes) (a) Petrova Company COMPUTATION OF INVENTORY FOR PRODUCT
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BAP UNDER FIFO INVENTORY METHOD March 31, 2008 Units Unit Cost Total Cost March 26, 2008 600 $12 $ 7,200 February 16, 2008 800 11 8,800 January 25, 2008 (portion) 200 10 2,000 March 31, 2008, inventory 1,600 $18,000 (b) Petrova Company COMPUTATION OF INVENTORY FOR PRODUCT BAP UNDER LIFO INVENTORY METHOD March 31, 2008 Units Unit Cost Total Cost Beginning inventory 600 $8 $ 4,800 January 5, 2008 (portion) 1,000 9 9,000 March 31, 2008, inventory 1,600 $13,800
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EXERCISE 9-11 (Continued) (c) Petrova Company COMPUTATION OF INVENTORY FOR PRODUCT BAP UNDER WEIGHTED-AVERAGE INVENTORY METHOD March 31, 2008 Units X Unit Cost = Total Cost Beginning inventory 600 $ 8 $ 4,800 January 5, 2008 1,200 9 10,800 January 25, 2008 1,300 10 13,000 February 16, 2008 800 11 8,800 March 26, 2008 600 12 7,200 4,500 $44,600 Weighted average cost ($44,600 ÷ 4,500) $9.91 * March 31, 2008, inventory 1,600 $9.91 $15,856 *Rounded
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EXERCISE 9-18 (25--30 minutes) (a) (1) Ending inventory-----Specific Identification Date No. Units Unit Cost
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This note was uploaded on 01/29/2012 for the course MAN 4635 taught by Professor Q during the Spring '11 term at Metro State.

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ch 9 homework solutions - EXERCISE 9-1 (15- 20 minutes)...

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