Brief Exercise 9-1Brief Exercise 9-8 Boyne Inc. had beginning inventory of $18,800at cost and $20,900at retail. Net purchases were $117,091at cost and $182,200at retail. Net markups were $12,600; net markdowns were $8,600; and sales revenue was $158,700. Compute ending inventory at cost using the conventional retail method. (Round ratios for computational purposes to 0 decimal places, e.g. 78% and final answer to 0 decimal places, e.g. 28,987.)

Exercise 9-3Exercise 9-7 Phil Collins Realty Corporation purchased a tract of unimproved land for $51,000. This land was improved and subdivided into building lots at an additional cost of $28,000. These building lots were all of the same size but owing to differences in location were offered for sale at different prices as follows.

Exercise 9-12Exercise 9-16 Gheorghe Moresan Lumber Company handles three principal lines of merchandise with these varying rates of gross profit on cost.

Exercise 9-19Exercise 9-21 The financial statements of ConAgra Foods, Inc.s 2012 annual report disclose the following information.

Problem 9-4

Eastman Company lost most of its inventory in a fire in December just before the year-end physical inventory was taken. Corporate records disclose the following.

Inventory (beginning)	$85,300	Sales revenue	$420,100
Purchases	363,600	Sales returns	21,300
Purchase returns	34,000	Gross profit % based on net selling price	33	%

Merchandise with a selling price of $39,300remained undamaged after the fire, and damaged merchandise has a net realizable value of $8,790. The company does not carry fire insurance on its inventory.

Compute the amount of inventory fire loss. (Do not use the retail inventory method.)

Inventory fire loss

$

(in millions)

May 27, 2012

May 29, 2011

May 30, 2010

Inventories

$1,870

$1,803

$1,598

Fiscal Year

2012

2011

Net sales

$13,263

$12,303

Cost of goods sold

10,436

9,390

Net income

474

818

Compute ConAgras (a) inventory turnover and (b) the average days to sell inventory for 2012 and 2011. (Round times to 1 decimal place, e.g. 7.6 and all other answers to 0 decimal places, e.g. 65.)

2012	2011
Inventory turnover:		times		times
Average days to sell inventory:		days

Presented below is information related to Ricky Henderson Company.

Cost	Retail
Beginning inventory	$54,960	$294,400
Purchases	1,458,000	2,148,000
Markups	95,700
Markup cancellations	16,500
Markdowns	40,300
Markdown cancellations	7,000
Sales revenue	2,329,000

Compute the inventory by the conventional retail inventory method. (Round ratios for computational purposes to 0 decimal places, e.g. 78% and final answer to 0 decimal places, e.g. 28,987.)

Ending inventory using conventional retail inventory method

$

Lumber

25%

Millwork

30%

Hardware and fittings

40%

On August 18, a fire destroyed the office, lumber shed, and a considerable portion of the lumber stacked in the yard. To file a report of loss for insurance purposes, the company must know what the inventories were immediately preceding the fire. No detail or perpetual inventory records of any kind were maintained. The only pertinent information you are able to obtain are the following facts from the general ledger, which was kept in a fireproof vault and thus escaped destruction.

Lumber	Millwork	Hardware
Inventory, Jan. 1, 2014	$272,500	$93,940	$52,500
Purchases to Aug. 18, 2014	1,520,800	380,900	161,000
Sales to Aug. 18, 2014	2,067,300	561,730	263,340

Submit your estimate of the inventory amounts immediately preceding the fire.

Lumber	Millwork	Hardware
Inventory	$	$

Mark Price Company uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below is information for the month of May.

Inventory, May 1	$179,300
Purchases (gross)	648,000
Freight-in	31,700
Sales revenue	1,035,700
Sales returns	83,400
Purchase discounts	12,500

(a) Compute the estimated inventory at May 31, assuming that the gross profit is 30% of sales.

The estimated inventory at May 31

$

(b) Compute the estimated inventory at May 31, assuming that the gross profit is 30% of cost. (Round percentage of sales to 2 decimal places, e.g. 78.74% and final answer to 0 decimal places, e.g. 6,225.)

The estimated inventory at May 31

$

Group

No. of Lots

Price per Lot

1

9

$3,450

2

15

4,600

3

19

2,300

Operating expenses for the year allocated to this project total $16,600. Lots unsold at the year-end were as follows.

Group 1	4lots
Group 2	7lots
Group 3	2lots

At the end of the fiscal year Phil Collins Realty Corporation instructs you to arrive at the net income realized on this operation to date. (Round ratios for computational purposes to 4 decimal places, e.g. 78.7234%. Round cost per lot and final answer to 0 decimal places, e.g. 5,845.)

Michael Bolton Company follows the practice of pricing its inventory at the lower-of-cost-or-market, on an individual-item basis.

Item No.	Quantity	Cost per Unit	Cost to Replace	Estimated Selling Price	Cost of Completion and Disposal	Normal Profit
1320	1,600	$3.90	$3.66	$5.49	$0.43	$1.53
1333	1,300	3.29	2.81	4.27	0.61	0.61
1426	1,200	5.49	4.51	6.10	0.49	1.22
1437	1,400	4.39	3.78	3.90	0.31	1.10
1510	1,100	2.75	2.44	3.97	0.98	0.73
1522	900	3.66	3.29	4.64	0.49	0.61
1573	3,400	2.20	1.95	3.05	0.92	0.61
1626	1,400	5.73	6.34	7.32	0.61	1.22

From the information above, determine the amount of Bolton Company inventory.

The amount of Bolton Companys inventory

$

Ending inventory using the conventional retail method

$

Presented below is information related to Rembrandt Inc.s inventory.

(per unit)	Skis	Boots	Parkas
Historical cost	$218.69	$122.01	$61.00
Selling price	244.01	166.90	84.89
Cost to distribute	21.87	9.21	2.88
Current replacement cost	233.65	120.86	58.70
Normal profit margin	36.83	33.38	24.46

Determine the following:

(a) the two limits to market value (i.e., the ceiling and the floor) that should be used in the lower-of-cost-or-market computation for skis.

Ceiling Limit	$
Floor Limit	$

(b) the cost amount that should be used in the lower-of-cost-or-market comparison of boots.

The cost amount

$

(c) the market amount that should be used to value parkas on the basis of the lower-of-cost-or-market.

The market amount

$

Brief Exercise 9-2 Floyd Corporation has the following four items in its ending inventory.

Item	Cost	Replacement Cost	Net Realizable Value (NRV)	NRV less Normal Profit Margin
Jokers	$2,394	$2,454	$2,514	$1,915
Penguins	5,985	6,105	5,925	4,908
Riddlers	5,267	5,446	5,536	4,429
Scarecrows	3,830	3,579	4,585	3,675

Determine the final lower-of-cost-or-market inventory value for each item.

Jokers	$
Penguins
Riddlers
Scarecrows