this is a first year university accounting assignment, basically it is about merchandise inventory and cost of good sold.

WileyPLUS Problem 6-4 Parker Furniture Shop Inc. uses the lower of cost and net realizable value basis for its inventory. The following data are available at December 31. Unit Cost/Unit Net Realizable s Value Tables Large 29 $272 $237 Small 35 137 163 Plastic 60 55 24 Wooden 41 17 34 Chairs What amount should be reported on Parker Furniture Shop's financial statements, after the lower of cost and net realizable value rule is applied to individual inventory items? LCNRV Tables: Large $ Small Chairs: Plastic Wooden Total $ Prepare the adjusting journal entry required, if any, to record the lower of cost and net realizable value of the inventory assuming Parker Furniture Shop uses a perpetual inventory system. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Account Titles and Debit Credit Explanation Dec. 31 Problem 5-3A Presented here are selected transactions for Alpine Tours Inc. during September of the current year. Alpine Tours uses a perpetual inventory system. Sept. 2 Purchased equipment on account for $25,630, terms n/30, FOB destination. 3 Freight charges of $660 were paid by the appropriate party on the September 2 purchase of equipment. 4 Purchased merchandise on account from Winterholt Company at a cost of $65,660, terms 1/15, n/30, FOB shipping point. 5 Purchased supplies for $4,760 cash. 7 Freight charges of $1,820 were paid by the appropriate party on the September 4 purchase of merchandise. 8 Returned damaged goods costing $5,040 that were originally purchased from Winterholt Company on September 4. Received a credit on account. 9 Sold merchandise costing $15,190 to Fischer Limited for $20,240 on account, terms 2/10, n/30, FOB destination. 10 Freight charges of $378 were paid by the appropriate party on the September 9 sale of merchandise. 17 Received the balance due from Fischer. 18 Paid Winterholt Company the balance due. 20 Purchased merchandise for $6,790 cash. 22 Sold inventory costing $20,250 to Kun-Tai Inc. for $27,550 on account, terms n/30, FOB shipping point. 23 Freight charges of $510 were paid by the appropriate party on the September 22 sale of merchandise. 28 Kun-Tai returned merchandise sold for $10,930 that cost $8,220. The merchandise was restored to inventory. Record the September transactions on Alpine Tours's books. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round answers to the nearest whole dollar, e.g. 5,275.) Date Account Titles and Explanation Sept. 2 3 4 Debit Credit 5 7 8 9 (Sale of Merchandise on account) 9 (Cost of goods sold recorded) 10 17 18 20 22 (Sale of Merchandise on account) 22 (Cost of goods sold recorded) 23 28 (Return of merchandise) 28 (Return of merchandise, assuming goods are resaleable and returned to inventory) Assume that Alpine Tours did not take advantage of the 1% purchase discount offered by Winterholt Company and paid Winterholt Company on Oct. 3 instead of September 18. Record the entry that Alpine Tours would make on Oct. 3 and determine the cost of missing this purchase discount to Alpine Tours. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round answers to the nearest whole dollar, e.g. 5,725.) Date Account Titles and Explanation Oct. 3 Debit Credit The cost of purchase discount is $ . Exercise 6-8 Seles Hardware Limited reported the following amounts for its cost of goods sold and merchandise inventory: 2015 Cost of goods sold 2014 $168,140 $154,150 38,270 32,380 Ending inventory Seles made two errors: (1) ending inventory for 2015 was overstated by $3,420 and (2) ending inventory for 2014 was understated by $5,000. Calculate the correct ending inventory and cost of goods sold amounts for each year. 2014 Ending inventory $ 2015 $ Cost of goods sold $ $ Describe the impact of the error on (1) cost of goods sold, (2) profit before income tax, (3) assets, (4) liabilities, and (5) total shareholders' equity for each of the two years. 2015 (1 Cost of 2014 $ $ $ $ $ $ $ $ $ $ ) goods sold (2 Profit ) before income tax (3 Assets ) (4 Liabilities ) (5 Total ) sharehold ers equity Exercise 6-11 The following information is available for Gildan Activewear Inc. , headquartered in Montreal, for three recent fiscal years (in U.S. $ thousands): 2012 2011 2010 Inventory $553,068 $568,311 $332,542 Net sales 1,948,253 1,725,712 1,311,463 Cost of goods sold 1,552,128 1,288,106 947,206 Calculate the inventory turnover, days in inventory, and gross profit margin for 2012 and 2011. (Round inventory turnover and current ratio to 1 decimal place, e.g. 15.2. Round days in inventory to nearest day.) Inventory Turnover Days In Inventory Gross Profit Margin 2012 times day % s 2011 times day % s Based on the ratios calculated above, did Gildan's liquidity and profitability improve or deteriorate in 2012? Problem 6-2A Lai's Sales Ltd., a small Ford dealership, has provided you with the following information with respect to its vehicle inventory for the month of June. The company uses the specific identification method. Dat Explanation Model Serial e June Unit Cost/Price # 1 Beg. inventory Fiesta C81362 $22,830 Mustan G62313 27,911 Flex X3892 29,414 F-150 F1883 23,792 F-150 F1921 27,948 Fiesta C81362 24,595 Mustan G62313 30,988 G71811 28,869 G71891 26,306 Flex X4212 28,691 Flex X4214 29,943 Escape E21202 27,166 Mustan G71891 31,627 Flex X3892 32,525 F-150 F1921 31,005 Escape E21202 30,393 Fiesta C81528 25,508 Escape E28268 28,650 g 8 Sales g 14 Purchases Mustan g Mustan g 20 Sales g 23 Purchases Determine the cost of goods sold and ending inventory for the month of June. Cost of Goods Sold $ Ending Inventory $ Determine the gross profit for the month of June. Gross profit $ Problem 5-2A Phantom Book Warehouse Ltd. distributes hardcover books to retail stores. At the end of May, Phantom's inventory consists of 179 books purchased at $20 each. Phantom uses a perpetual inventory system. During the month of June, the following merchandise transactions occurred: June 1 Purchased 144 books on account for $20 each from Reader's World Publishers, terms n/30. 3 Sold 152 books on account to The Book Nook for $23 each, with a cost of $20, terms 2/10, n/30. 5 Received a $220 credit for 11 books returned to Reader's World Publishers. 8 Sold 82 books on account to Read-A-Lot Bookstore for $32 each, with a cost of $20, terms 2/10, n/30 9 Issued a $320 credit memorandum to Read-A-Lot Bookstore for the return of 10 damaged books. Th determined to be no longer saleable and were destroyed. 11 Purchased 130 books on account for $16 each from Read More Publishers, terms n/30. 12 Received payment in full from The Book Nook. 17 Received payment in full from Read-A-Lot Bookstore. 22 Sold 123 books on account to Reader's Bookstore for $23 each, with an average cost of $18, terms 2 25 Granted Reader's Bookstore a $529 credit for 23 returned books. These books were restored to inve 29 Paid Reader's World Publishers in full. Is the Phantom Book Warehouse a retailer or a wholesaler? The Phantom Book Warehouse is a . Record the June transactions for Phantom. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round all answers to 0 decimal places, e.g. 125. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation June 1 3 (To record sales) 3 Debit Credit (To record cost of goods sold) 5 8 (To record sales) 8 (To record cost of goods sold) 9 11 12 17 22 (To record sales) 22 (To record cost of goods sold) 25 (To record sales returns) 25 (To record cost of goods returned) 29 Create a T account for the Merchandise Inventory account. Post the opening balance and June transactions, and calculate the June 30 balance in the account. Merchandise Inventory Determine the number of books Phantom has on hand on June 30. What is the average cost of these books on June 30? (Hint: Divide the ending balance in the Merchandise Inventory account calculated in (c) and divide it by the number of books on hand at June 30.) (Round average cost per book to 2 decimal places, e.g. 5.25.) Books on hand at June 30 Average cost per book $ WileyPLUS Problem 6-2 Selbe Inc. is a retailer using the perpetual inventory method. All sales returns from customers result in the goods being returned to inventory. (Assume that the inventory is not damaged.) Assume that there are no credit transactions; all amounts are settled in cash. You are provided with the following information for Selbe Inc. for the month of January. Date Description Quantity Unit Cost or Selling Price Dec 31 Ending . 163 $22 90 22 183 41 9 41 inventory Jan. 2 Purchase Jan. 6 Sale Jan. 9 Sale return Jan. 9 Purchase 72 24 Jan. 10 Purchase return 18 24 Jan. 10 Sale 51 48 Jan. 23 Purchase 109 28 Jan. 30 Sale 122 52 Using FIFO method, calculate (i) cost of goods sold, (ii) ending inventory, and (iii) gross profit. (Assume sales returns had a cost of $22 and purchase returns had a cost of $24.) Cost of goods sold $ Ending Inventory $ Gross Profit $ Using Average method, calculate (i) cost of goods sold, (ii) ending inventory, and (iii) gross profit. (Round answers to 2 decimal places e.g 5.25.) Cost of goods sold $ Ending Inventory $ Gross Profit $ Compare results for the two cost formulas. (1) In a period of rising costs, the average cost formula results in the cost of goods sold and gross profit. FIFO gives the cost of goods sold and gross profit. (2) In period of rising prices, on the statement of financial position, FIFO gives the ending inventory (representing the most current costs). Average gives the ending inventory (representing the oldest costs). Exercise 5-3 On April 1, the beginning of its fiscal year, Burke Wholesale Company Ltd. had an inventory of 16 hair dryers at a cost of $23 each. The company uses a perpetual inventory system. During April, the following transactions occurred: Apr. 2 Purchased 76 hair dryers for $23 each from Digital Corp. on account, terms n/30. 10 Returned 3 hair dryers to Digital for $69 credit because they did not meet specifications. 11 Sold 33 hair dryers for $33 each to Burke Book Store, terms n/30. 14 Granted credit of $33 to Burke Book Store for the return of 1 hair dryer that was not ordered. The hair dryer was restored to inventory. 21 Sold 36 hair dryers for $33 each to Student Card Shop, terms 1/10, n/30. 29 Paid Digital the amount owing. 30 Received payment in full from the Student Card Shop. Record the April transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places, e.g. 125.) Date Account Titles and Explanation Apr. 2 10 11 (To record credit sale) 11 (To record cost of merchandise sold) 14 (To record return of goods) Debit Credit 14 (To record cost of merchandise returned) 21 (To record credit sale) 21 (To record cost of merchandise sold) 29 30 Create T accounts for the Merchandise Inventory and Cost of Goods Sold accounts. Post the opening balance and the April transactions. (Post entries in the order presented in the problem) Merchandise Inventory Cost of Goods Sold Determine the ending balances in both dollars and quantities. Number of hair dryers Cost of hair dryers $ Exercise 5-6 The following merchandise transactions occurred in December. Both companies use a perpetual inventory system. Dec 3 . Pictou Ltd. sold $18,741 of merchandise to Thames Corp., terms 2/10, n/30, FOB shipping point. The cost of the merchandise sold was $10,400. 7 Shipping costs of $496 were paid by the appropriate company. 8 Thames returned unwanted merchandise to Pictou. The returned merchandise has a sales price of $1,300, and a cost of $689. It was restored to inventory. 11 Pictou received the balance due from Thames. Record the above transactions in the books of Pictou (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round answers to the nearest whole dollar, e.g. 5,275.) Date Account Titles and Explanation Dec. 3 (To record credit sale) Debit Credit 3 (To record cost of merchandise sold) 7 8 (To record return of goods) 8 (To record cost of merchandise returned) 11 Record the above transactions in the books of Thames. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round answers to the nearest whole dollar, e.g. 5,275.) Date Account Titles and Explanation Dec. 3 7 8 11 Debit Credit Calculate the gross profit earned by Pictou on the above transactions. Gross Profit $ Exercise 6-12 The following comparative cost formula information is available for Kingswood Limited: Average Inventory Cost of Goods Sold FIFO Average $224,600 $760,500 233,700 762,200 Kingswood's current assets are $461,000, exclusive of inventory. Its current liabilities are $355,400. Calculate Kingswood's inventory turnover ratio assuming (1) FIFO and (2) average cost is used to determine the cost of the ending inventory. (Round answers to 1 decimal place, e.g. 15.2.) FIFO Inventory Turnover Average time s time s Calculate Kingswood's current ratio assuming (1) FIFO, and (2) average cost is used to determine the cost of the ending inventory. (Round answers to 1 decimal place, e.g. 15.2.) FIFO Average Current Ratio time s time s WileyPLUS Problem 5-4 Financial information is presented here for two companies. Iwig Inc. Sales $ Pratt Inc. $90,620 $ Sales returns ? ? 5,400 Net sales 84,420 102,330 Cost of goods sold 57,650 ? ? 40,100 14,250 ? ? 18,580 Gross profit Operating expenses Profit Fill in the missing amounts. Iwig Inc. Pratt Inc. Sales $90,620 Sales returns $ 5,400 Net sales 84,420 Cost of goods sold 57,650 Gross profit Operating 102,330 40,100 14,250 expenses Profit 18,580 Calculate the profit margin and the gross profit margin for each company. (Round answer to 1 decimal place, e.g. 17.5%.) Iwig Profit margin Gross profit margin Pratt % % % % Exercise 5-8 The following selected accounts from the Okanagan Corporation's general ledger are presented below for the year ended October 31, 2015: Advertising expense $54,200 Common shares 250,460 Cost of goods sold 1,084,800 Depreciation expense 125,900 Dividends 150,800 Freight out 26,000 Income tax expense 69,950 Insurance expense 15,760 Interest expense 69,950 Interest revenue 30,200 Merchandise inventory 66,160 Rent revenue 23,090 Retained earnings 534,100 Salaries expense 675,200 Sales 2,414,000 Sales discounts 8,942 Sales returns and allowances Unearned revenue 41,430 7,000 Prepare a single-step income statement. Okanagan Corporation Income Statement (Single-step) Year Ended October 31, 2015 $ : $ $ $ $ Prepare a multiple-step income statement. Okanagan Corporation Income Statement (Multiple-step) Year Ended October 31 , 2015 $ : $ $ $ $