A review of the Double Rainbow Corporation shows the following purchases and sales:

Jan 1Beginning inventory50 units at $16.00 $800

March 3Purchases100 units at $19.00 $1.900

April 7Sales110 units at $38.00

Aug. 21Purchases60 units at $22.00 $1,320

Oct. 3Purchases30 units at $20.00 $600

Dec 15Sales64 units at $36.00

REQUIRED: Calculate the following.Show all calculations to receive full marks.

i.Calculate the number of units in ending inventory. (3 marks)

Answer: _____________________

ii.Calculate FIFO total $ in ending inventory based on the perpetual method (3 marks)

Answer: $_____________________

iii. Weighted average total ending inventory based on the periodic method (3 marks) (round weighted average cost to 2 decimal places. Round final answer to nearest dollar)

Answer: $_______________

iv. Using FIFO based on the perpetual method, calculate the total gross profit. (3 marks)

Answer:$________________

qn2

1.Which of the following approaches for bad debts is best described as a balance sheet method?

a)Direct write off method

b)Financial statement method

c)Percentage of sales method

d)Aging of receivables method

e)Both a) and b)

2. The following figures are provided for Hanauma Marketing Corp. What is gross margin? (3 marks)

Sales revenue$960,000

Cost of goods sold 600,000

Sales discounts40,000

Sales returns and allowances 30,000

Operating expenses 170,000

Interest revenue10,000

a) $210,000

b) $280,000

c) $360,000

d) $290,000

e) $180,000

3.To include the personal assets and transactions of a business's owner in the records and reports of the business would be a violation of the:

a) Objectivity principle.

b) Revenue recognition principle.

c) Business entity principle.

d) Going-concern principle.

e) none of the above would be violated.

4.The journal entry to purchase merchandise under a perpetual inventory system includes a:

a) debit to purchases

b) debit to cost of goods sold

c) debit to inventory

d) credit to purchases

5.Under the cash basis of accounting

a) advance payments from customers are recorded as Earned Revenue.

b) payments for insurance premiums are debited to insurance expense.

c) the balance in the Accounts Receivable account is always zero.

d) A), B) and C) are all correct.

e) a business requires more than one bank account in order to adequately record its daily transactions.