Information for BigFish Tackle Co. Ltd. is presented in P6-3B. Use the same inventory data and assume
Question:
Information for BigFish Tackle Co. Ltd. is presented in P6-3B. Use the same inventory data and assume that the company uses the perpetual inventory system.
Instructions
(a) Determine the cost of goods sold and cost of ending inventory using average cost. (Use unrounded numbers in your calculations but round to the nearest cent for presentation purposes in your answer.)
(b) When the company counted its inventory at the end of April, it counted only 49 rods on hand. What journal entry, if any, should the company make to record this shortage?
(c) If the company had not discovered this shortage, identify what accounts would be overstated or understated and by what amount.
Ending InventoryThe ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...
Step by Step Answer:
Financial Accounting Tools for Business Decision Making
ISBN: 978-1118644942
6th Canadian edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine