Briefly explain the gross profit method of estimating inventories. In what types of situations is this technique

Question:

Briefly explain the gross profit method of estimating inventories. In what types of situations is this technique likely to be useful?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Financial and Managerial Accounting the basis for business decisions

ISBN: 978-0078111044

16th edition

Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello

See More Books

Question Posted: Apr 17, 2014 10:22 AM

See More Questions

Explain the gross profit method of estimating ending inventory .
What is credit scoring? In what types of situations is it most useful? If you were developing a credit scoring model, what factors might be most useful in predicting whether or not a credit customer...
The Rider Company uses the gross profit method to estimate ending inventory and cost of goods sold. The cost percentage is determined based on historical data. What factors could cause the estimate...
Hatch plc has two classes of share capital outstanding: 8%, 20 par preference and 5 par ordinary. At December 31, 2021, the following accounts were included in equity. Share CapitalPreference,...
A company manufacturing surfboards has fixed costs of $300 per day and total costs of $5,100 per day for a daily output of 20 boards. (A) Assuming that the total cost per day C(x) is linearly related...
Suppose there are only two firms?Softies Inc. and Cuddlies Inc.? producing disposable diapers. Both firms are releasing dioxins into the same river. To reduce the pollution, the regulatory agency...
If a firm collects an account receivable, the current ratio __________.
NPV versus IRR Bumble??s Bees, Inc., has identified the following two mutually exclusive projects: a. What is the 1RR for each of these projects? Using the IRR decision rule, which project should the...
Lighthouse Paper Company manufactures newsprint. The product is manufactured in two departments, Papermaking and Converting. Pulp is first placed into a vessel at the beginning of papermaking...
1. What were the main differences between the way work was organised at TCS and at Scotchem? 2. What implications did this have for skill? 3. What impact would improving or increasing training have...
Explain why errors in the valuation of inventory at the end of the year are sometimes called counterbalancing or self-correcting.
How is the inventory turnover computed? Why is this measurement of interest to short-term creditors?
ABC, Inc. has a target debt-equity ratio of 0.4. Its cost of equity is 16 percent and its cost of debt is 8 percent. If the tax rate is 32 percent, what is ABC's WACC? a. 10.3847% b. 11.6723% c....
The Tokyo Olympics. After watching how the tokyo olympics became the most expensive summer game ever video answer the following questions. Q 3 : As you saw in the video, the capital investment a city...
write at least two paragraphs discussing the experiences of individuals who identify outside the traditional binary gender system (male/female.) Please explore the challenges they face and how...
Newly formed S&J Iron Corporation has 163,000 shares of $5 par common stock authorized. On March 1, Year 1, S&J Iron issued 9,000 shares of the stock for $12 per share. On May 2, the company issued...
Use the SMOKE for this question. The variable cigs is the number of cigarettes smoked per day. How many people in the sample do not smoke at all? What fraction of people claim to smoke 20 cigarettes...
Transcribed image text : Reproduced below from Farthington Supply's accounting records is the accounts receivable subledger along with selected general ledger accounts. Dec. 31/19 Balance Credit...
The calculation of the WACC is straightforward in theory, but difficult in practice. Outline any possible difficulties that might be experienced when trying to calculate the WACC.
Which of the following is FALSE regarding the purchasing power parity (PPP). a. The PPP is a manifestation of the law of one price b. The PPP says that a country with a higher expected inflation can...
On reviewing the financial statements, the companys accountant discovers that a payment of 21,000 made to a supplier has been incorrectly recorded in the cash book and in other internal accounting...
Define standard costs and briefly indicate how they may be used by management in planning and control.
Who might a plant accountant consult with when establishing direct labor quantity or rate standards?
Who might a plant accountant consult with when establishing direct labor quantity or rate standards?
When preparing government-wide financial statements, the modified accrual based governments funds are adjusted. Please show the adjustments (in journal entry form with debits and credits) that would...
I need help finding the callable price and call value
On 31 October 2022, the owner took goods for his son as a birthday gift. The cost price of the goods was R15 000

Briefly explain the gross profit method of estimating inventories. In what types of situations is this technique

Question:

Step by Step Answer:

Under the gross profit method the cost of goods sold is estimated by a...View the full answer

Financial and Managerial Accounting the basis for business decisions

Students also viewed these Managerial Accounting questions