Q1-MG Hill, a publishing company, shipped 500 copies of an introductory accounting text to the North York University Bookstore on August 31, 2007. The books had a retail price of $100 each, and the bookstore was entitled to a trade discount of 30%, so the cost for the bookstore was $70 per book. By December 31, 2007 the books had not been paid for, but 80% (400) of them had been sold. According to the contract of sale, up to 10% of the order was returnable to the publisher if unsold within one year, but not more than 10%, and nothing after a year from the delivery. At the bookstore it is confidently expected that the unsold books will be sold in January 2008. A) In the income statement of MG Hill, what would be the amount of revenue recognized in year 2007? B) In the income statement of North York University Bookstore, what would be the revenue recognized in year 2007? C) In the income statement of North York University Bookstore, what would be the cost of goods sold recognized in year 2007? D) For the North York University Bookstore, the gross profit percentage on this transaction would be _________. [07/10, 12:04 am] Biren Bhai: Q2-The balance sheet of Steel Traders Inc. as at December 31, 2015, was as follows: The balance sheet of Steel Traders Inc. as at December 31, 2015, was as follows: Current assets Current liabilities Cash 50,000 Trade payables 165,000 Receivables 450,000 Bank loan 180,000 Inventory 425,000 Income tax due 55,000 Total 925,000 Total 400,000 Long-term liabilities 450,000 Long-term assets 500,000 Total liabilities 850,000 Shareholders equity Share capital 175,000 Retained earnings 400,000 Total 575,000 Total 1,425,000 Total 1,425,000 You are told that the sales revenue for 2015 was $9,800,000 and that the company made a net income of $500,000 in 2015. (i) Inventory holding period (ii) Is the company Liquid? [07/10, 12:05 am] Biren Bhai: Q3-As at December 31, 2015, Superior Software Inc. had a total of $2,800,000 recorded as owed by credit sale customers. Of this, $380,000 was owed by a customer who ran away and is unlikely to pay his debt. In respect of the balance, the company has decided to introduce (for the first time) a provision for doubtful accounts of 5% of the amount owed. A) How would the accounts receivable appear on the balance sheet as at December 31, 2015? [07/10, 12:05 am] Biren Bhai: Q4When Mercator Manufacturing Inc. checked its stores, it had the following inventory on hand as at December 31, 2015. -For each of the following, show how the inventory would appear in the balance sheet as at December 31, 2015. (i) 5,000 litres of lubricating oil that had cost $2.50 per litre: As at December 31, the replacement price was $3.00 per litre. (ii) 50,000 kg of steel that had cost $0.50 per kg: As at December 31, the replacement price was $0.48 per kg. (iii) Spare parts that had cost $25,000: Mostly for production machinery that was no longer in use, so it was unlikely they could be used. They have no resale value. (iv) replacement control unit for a customers milling machine, which has a resale value of $10,000: The control unit was bought by the customer so that Mercator could use it to repair their milling machine. (v) 20,000 of electronic parts that were in good working order but had gone beyond their sell by dates on the packages. (vi) Total Inventory value -If Mercartor Manufacturings sales for 2015 totalled $500,000, calculate: (i) The inventory turnover ratio (ii) The inventory holding period