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P8.1 (L03) Groupwork (Various Inventory Issues) The following independent situations relate to inventory accounting. 1. Kim Co. purchased goods with a list price of 175,000,
P8.1 (L03) Groupwork (Various Inventory Issues) The following independent situations relate to inventory accounting. 1. Kim Co. purchased goods with a list price of 175,000, subject to trade discounts of 20% and 10%, with no cash discounts allowable. How much should Kim Co. record as the cost of these goods? 2. Keillor Company's inventory of 1,100,000 at December 31, 2019, was based on a physical count of goods priced at cost and before any year-end adjustments relating to the following items. a. Goods shipped from a vendor fo.b. shipping point on December 24, 2019, at an invoice cost of 69,000 to Keillor Company were received on January 4, 2020. b. The physical count included 29,000 of goods billed to Sakic Corp. f.o.b. shipping point on December 31, 2019. The carrier picked up these goods on January 3, 2020. What amount should Keillor report as inventory on its statement of financial position? 3. Zimmerman AG had 1,500 units of part M.O. on hand May 1, 2019, costing 21 each. Purchases of part M.O. during May were as follows. Units Unit Cost May 9 2,000 22 17 3,500 23 26 1,000 24 A physical count on May 31, 2019, shows 2,000 units of part M.O. on hand. Using the FIFO method, what is the cost of part M.O. inventory at May 31, 2019? Using the average-cost method, what is the inventory cost? 4. Donovan AS, a retail store chain, had the following information in its general ledger for the year 2019. Merchandise purchased for resale 909,400 Interest on notes payable to vendors 8,700 Purchase returns 16,500 Freight-in 22,000 Freight-out (delivery expense) 17,100 Cash discounts on purchases 6,800 What is Donovan's inventoriable cost for 2019? Instructions Answer each of the preceding questions about inventories, and explain your answers
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