Mannisto, Inc., uses the FIFO inventory cost flow assumption. In a year of rising costs and prices, the firm reported net income of $1,500,000 and average assets of $10,000,000. If Mannisto had used the LIFO cost flow assumption in the same year, its cost of goods sold would have been $300,000 more than under FIFO, and its average assets would have been $300,000 less than under FIFO.

Required:

a.Calculate the firm's ROI under each cost flow assumption (FIFO and LIFO).(Enter your answers as percentages rounded to 1 decimal place (i.e., 12.2%).)

b.Suppose that two years later costs and prices were falling. Under FIFO, net income and average assets were $1,800,000 and $12,000,000, respectively. If LIFO had been used through the years, inventory values would have been $200,000 less than under FIFO, and current year cost of goods sold would have been $100,000 less than under FIFO. Calculate the firm?s ROI under each cost flow assumption (FIFO and LIFO).(Enter your answers as percentages rounded to 1 decimal place (i.e., 12.2%).)

On January 1, 2016, the balance in Kubera Co.'s Allowance for Bad Debts account was $9,720. During the year, a total of $23,900 of delinquent accounts receivable was written off as bad debts. The balance in the Allowance for Bad Debts account at December 31, 2016, was $10,480.

Required:

a.What was the total amount of bad debts expense recognized during the year? (Hint:Make a T-account for the Allowance for Bad Debts account.)

b.As a result of a comprehensive analysis, it is determined that the December 31, 2016, balance of Allowance for Bad Debts should be $23,200. Show the adjustment required in journal entry format.(If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

\fMannisto, Inc. Requirement (a) Net income Divided by: Average assets Return on investment FIFO 1,500,000 10,000,000 15.0% LIFO 1,200,000 9,700,000 12.4% FIFO 1,800,000 12,000,000 15.0% LIFO 1,900,000 11,800,000 16.1% Requirement (b) Net income Divided by: Average assets Return on investment Kubera Co. Requirement (a) Allowance for Bad Debts 23,900 9,720 10,480 24,660 Requirement (b) Doubtful Accounts Expense Allowance for Bad Debts To record adjustment for bad debts 12,720 12,720 Bank Reconciliations Bank Reconciliation Oct-31 Balance per bank Add: Deposit in transit Deduct: Outstanding checks Reconciled balance 746 900 - 126 - 900 1,646 126 1,520 Reconciliation Oct-31 Balance per book Add: 1,688 - Deduct: NSF check Correction of bank error Reconciled balance 150 18 - 1,688 1,688