ALL QUESTIONS MUST BE ANSWERED

Inventory 30 POINTS

Compute the inventory methods for TV Vison. Suppose TV Vison started March with an inventory of 50 plasma TVs that cost $2,010 each, for a total beginning inventory value of $100,500. During March, the firm made the following purchases:

March 2 200 TVs for $2,000 each

March 10 150 TVs for $1,800 each

March 20 100 TVs for $1,500 each

March 29 50 TVs for $1,000 each

During March, the firm made the following sales:

March 5 110 TVs for $4,000 each

March 12 160 TVs for $4,000 each

March 25 150 TVs for $4,000 each

Instructions:

A] Using periodic inventory record keeping, calculate the cost of goods sold for the month and the ending inventory at the end of the month. Do these calculations using THREE METHODS, Weighted Average Cost, FIFO, and LIFO.

B] All other operating expenses amount to $250,000. Calculate net income using each of the three methods.

C] Using the perpetual inventory record keeping, calculate the ending inventory and cost of goods sold for TV Vison adopting the LIFO and FIFO methods.

D] Why do companies avoid the perpetual weighted moving average method of calculating inventory costs?

Bad Debt 20 POINTS

M&M Inc. has a problem with accounts receivables reaching a very high dollar amount. You assignment is determine bad debt expense that must be posted at 12/31/2019. Total account receivables for 2019 is $1,000,000.

The head of the AR department for M&M Inc. provides an aging analysis worksheet below.

Accounts Receivable 0-60 days $250,000

Accounts Receivable 61-90 days $175,000

Accounts Receivable 91-120 days $375,000

Accounts Receivable 121-180 days $125,000

Accounts Receivable Over 180 days $75,000

In previous years, M&M Inc. had use various percentages to describe the risk associated with old accounts. This year the company selected the following percentages {2%; 5%; 15%; 20; and finally 25%}.

If the company had, a zero balance in the allowance account then what would the bad debt expense entry be for the year 2019?

If the company had a $1,200 credit balance in the allowance account, then what would be the expense entry for the year 2019?

If the company had a $5,000 debit balance in the allowance account then what would be the expense entry for the year 2019?

CASH FLOW QUESTIONS 20 POINTS

C Companys current year income statement reports the following:

Sales $825,000

Cost of Goods Sold $550,000

Gross Profit $275,000

C Companys comparative balance sheets show the following:

End of Year Beginning of the Year

Accounts receivable $71,000 $60,000

Inventory $109,000 $96,000

Accounts payable $31,000 $37,000

Compute the cash received from customers and the cash paid for inventory purchases.

Determine the Cash Paid for Taxes during the year using the following information. Five Points

Tax Expense $100,000 for the year

Tax Payable at the beginning of the year $73,000

Tax Payable at the end of the year $19,000

Depreciation Expense 15 POINTS

Edgy Inc. acquired $250,000 in equipment in 2019 and wishes for you to calculate its depreciation expense journal entry at the end year for years ending 12/31/2019; 12/31/2020; and 12/31/2021.

Machine A was acquired on January 2, 2019 for $100,000. Useful life is five years.

Machine B was acquired on June 30, 2019. Useful life is four years.

What is the total depreciation expense for years 2019, 2020, and 2021 using Double Declining Balance: Sum-of-the-Digits: and Straight Line Depreciation.

EQUITY EVENTS 10 POINTS

From a companys perspective explain the significance of the following events

Stock Splits

Stock Dividends

Cash Dividends