Penultimate Company uses a perpetual inventory system and has a December 31 year-end. Its records show the following data for the current year: Inventory beginning of year per General Ledger - 36,450 Inventory end of year unadjusted per General Ledger - $35,000 Purchases during the year - $60,000 Physical inventory count end of year - 43,900 Accounts Payable invoices dated December for inventory purchases ordered but in transit at year end - $6,000 Trade terms with suppliers – Net 30 days, FOB destination Required 1: Assuming no other transaction happened, what value will show on Penultimate's year end balance sheet for inventory? $ Required 2: Assuming no other transaction happened, what value will show on Ultimate's Income Statement as the Cost of Goods Sold? $ Required 3: Assuming no other transaction happened, what was the amount of Merchandise Available For Sale? $
Penultimate Company uses a perpetual inventory system and has a December 31 year-end. Its records show the following data for the current year: Inventory beginning of year per General Ledger - 36,450 Inventory end of year unadjusted per General Ledger - $35,000 Purchases during the year - $60,000 Physical inventory count end of year - 43,900 Accounts Payable invoices dated December for inventory purchases ordered but in transit at year end - $6,000 Trade terms with suppliers – Net 30 days, FOB destination Required 1: Assuming no other transaction happened, what value will show on Penultimate's year end balance sheet for inventory? $ Required 2: Assuming no other transaction happened, what value will show on Ultimate's Income Statement as the Cost of Goods Sold? $ Required 3: Assuming no other transaction happened, what was the amount of Merchandise Available For Sale? $
Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter6: Inventories
Section: Chapter Questions
Problem 5PB: Pappas Appliances uses the periodic inventory system. Details regarding the inventory of appliances...
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Penultimate Company uses a perpetual inventory system and has a December 31 year-end. Its records show the following data for the current year:
Inventory beginning of year per General Ledger - 36,450
Inventory end of year unadjusted per General Ledger - $35,000
Purchases during the year - $60,000
Physical inventory count end of year - 43,900
Accounts Payable invoices dated December for inventory purchases ordered but in transit at year end - $6,000
Trade terms with suppliers – Net 30 days, FOB destination
Required 1: Assuming no other transaction happened, what value will show on Penultimate's year end balance sheet for inventory? $
Required 2: Assuming no other transaction happened, what value will show on Ultimate's Income Statement as the Cost of Goods Sold? $
Required 3: Assuming no other transaction happened, what was the amount of Merchandise Available For Sale? $
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Step 1: Introduction of ending inventory, cost of goods sold, and merchandise available for sale.
VIEWStep 2: Requirement 1 - Compute the year end balance sheet value for inventory
VIEWStep 3: Requirement 2 - Computation of cost of goods sold
VIEWStep 4: Requirement 3 - Computation of the amount of merchandise available for sale
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