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I need some help creating this in Excel and just having some issues, thank you for your help! Second case #1: CRV Corp manufactures small
I need some help creating this in Excel and just having some issues, thank you for your help!
Second case #1: CRV Corp manufactures small plastic fittings for plumbing applications. They have accepted a new contract to provide a wide range of custom plastic fittings. To service the contract, CRV purchases a new, highly complex plastic injection molding machine. CRV's fiscal year coincides with the calendar year. The machine is installed and operational as of July 1, 2015. CRV provides the following data: 1. Purchase price of machine: 2. Shipping and installation: 3. Training costs: 4. Useful life: 5. Estimated salvage: $275,000 $ 45,000 $ 15,000 5 years $ 12,500 Required: Prepare a depreciation schedule showing Net Book value (beginning and ending), depreciation expense, and accumulated depreciation for the asset. Hint: pay attention to dates of acquisition and fiscal year. Prepare one schedule for each method: a. Straight-line b. Double-declining balance (use the "Factor column" for the DDB depreciation % Excel Format Year Depreciation expense Accumulated Depreciation NBV beg Factor NBV ending 2. Qualitative analysis: CRV Company receives an offer of $159,000 for the machine in December, 2018. a. What factors should CRV Company consider in determining whether to sell or keep the machine? b. Evaluate the implication on taxable income under each deprecation method assuming CRV sells the machine at the end of December 2018. Use $ values to support your support your written narrative. #2: Inventory valuation: The operations manager for CRV has asked you to provide a quantitative and qualitative inventory analysis using a sample of purchases as shown below. Beginning inventory Purchases: Units 1,750 2,100 1,600 850 Unit cost $3.95 $3.75 $4.10 $4.20 Total cost $6,913 $7,875 $6,560 $3,570 Sales 4,100 units sold The manager has asked for the following: 1. Calculate the $ ending inventory and $ cost of goods sold using each of the following inventory methods: a. FIFO b. LIFO C. Average cost Method: Ending inventory $ COGS $ FIFO LIFO Average cost 2. Which inventory method would you recommend for reporting for income tax purposes to minimize taxable income? Why? 3. The company is operating in an inflationary environment. Which method should the company use to maximize inventory valuation? Why? 4. Looking at the purchasing volume versus demand, what guidance would you offer to the operations manager regarding inventory management and cash flow? All calculations must be indicated via Excel formulas
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