Sir, Madam,

I have toget the solutions tothis accounting exercise before this Saturday. Is this possible ?

You will find all exercises attached.

Please provide me with the answers in the same order, in a structured manner,to avoid anyconfusion.

Furthermore, would you please provide me with all explanations? I really need to understand how yougot to the solutions.

Thank you so much in advance.

Yours sincerely,

Sabrina

Exercises: ACC Exercise 1) Evaluation of Inventory: A company has collected the following data from the purchase and use of heating fuel from its Business Statistics department for inventory management of the previous year: Date 12.1.2006 14.2,2006 25.3.2006 28.6.2006 29.8.2006 Amount purchased (liters) 15000 20000 6000 18000 33000 Date Amount used/consumed (liters) 7000 23000 9000 11000 30.9.2006 31.10,2006 30.11.2006 31.12.2006 Purchase Price (EUR/liter) 0,80 0,75 0,81 0,90 0,76 a) Calculate the cost/use of material sold for the material(energy): Based on the following evaluation methods: - FIFO - HIFO - LIFO - average price b) Book the transaction for the consumption of the fuel at the 31.12.2006 (1.1.-31.12.2006) correctly by using the FIFO-method and indicate the effect on the profit! (All the purchases of the fuel have been recorded yet!) Date Debit Credit Amount (EUR) 31.12.2006 Effect on the profit? ......................... 1 Exercise 2) Depreciation: The following data for a machinery is available: Purchase price (incl. 20%VAT) Salvage value (excl VAT) 360 000 EUR 10 000 EUR useful life (=estimated service life) 7 years production capacity 580 000 hours 1st year: production (2006) 120 000 hours 2nd year: production (2007) 160 000 hours 3rd year: production (2008) 130 000 hours 4th year: production (2009) 80 000 hours th 5 year: production (2010) 50 000 hours 6th year: production (2011) 40 000 hours th 7 year: production (2012) 30 000 hours a) Calculate the straight-line depreciation. (straight-line method) b) Calculate the depreciation based on the activity method. c) What other depreciation methods do you know? d) Calculate the depreciation for 2006 and the book value (31.12.2006) in accordance with the Austrian (taxation) regulations (straight-line) if the machinery has been purchased at 30 May 2006. e) Calculate the depreciation for 2006 and the book value (31.12.2006) in accordance with the Austrian (taxation) regulations (straight line) if the machinery has been purchased at 5 August 2006. 2 3