Inventory

1.       Gray Company’s inventory at December 31, 2012 was P 1,500,000 based on a physical count of goods priced at cost,  before any necessary year-end adjustments relating to the following:

a.        Included in the physical count were goods billed to a customer F.O.B shipping point on December 31, 2012. These goods had a cost of P 30,000 and were picked by the carrier on January 10, 2013.

b.       Goods shipped FOB shipping point on December 28, 2012 from a vendor to Gray were received on January 4, 2013. The invoice cost was P 50,000.

 

What amount should Gray report as report on its December 31, 2012 balance sheet?

1. The inventory on hand on December 31, 2012 of Libra Corporation is valued at a cost of P 300,000. The following items were not included in the inventory:

ü  Purchased goods in transom it shipped FOB destination, with price of P 30,000 which includes freight charge of P 5,000.

ü  Goods held on consignment by Libra at a sales price of P 10,000 excluding a 20% commission on the sales price. Freight paid by Libra P 1,000.

ü  Goods sold in transit FOB destination with invoice price of P 49,000, which includes freight charge of P 4,000 to deliver the goods.

ü  Purchased goods in transit FOB shipping point with invoice price of P 60,000. Freight cost amounts to P 6,000.

ü  Goods out on consignment with sales price of P 30,000. Shipping costs amounts to P 3,000.

What is the correct inventory on December 31, 2012 assuming Libra’s selling price is 150% of costs?

1. You are called by Ernie Bee of Delicious Foods on July 16 and asked to prepare a claim for insurance as a result of a theft that took place the night before. You suggest that an inventory be taken immediately. The following data are available:

               

                Inventory, July 1                                                                                   P 38,000

                Purchases- goods placed in stock July 1-15                                    85,000

                Sales-goods delivered to customers (gross)                                   116,000

                Sales returns- goods returned to tock                                             4,000

 

                The company reported that the goods on hand on July 16 cost P 29,000 which included P 6,000 goods received on a consignment basis. Past record shows that sales are made approximately at 40% over cost. How much is the claim against the insurance company for the value of inventory stolen?

1. Below are the records of DEC Company’s inventory and related records

 

                Merchandise Inventory, January 1, 2012                                                        P 450,000

                Purchases for the year 2012                                                                             3,150,000

                Sales for the year 2012                                                                                      4,000,000

 

                On December 31, 2012 a physical inventory was conducted in the company’s warehouse and determined to be P 750,000. DEC’s gross profit on sales remained constant at 30%. The company’s president suspects some of the merchandise may have been pilfered by some new employees. AT December 31, 2012, what is your estimated cost of missing inventory.

The following data were available for Modfood Manufacturing Corporation for the year ended December 31, 2012.

 

Total Manufacturing Cost                   P 900,000

Cost of Goods Manufactured                             800,000

Factory Overhead                                                75% of direct labor and 25% of total manufacturing cost

 

Beginning work in process inventory, January 1, was 60% of ending work in process inventory, December 31, 2012

 

Manufacturing costs for the year ended December 31, 2012 were as follows:

 

Raw Materials Used                                                                             P 400,000

Direct Labor                                                                                          275,000

Factory Overhead                                                                                225,000

                Total                                                                                       P 900,000

________1)               The following information was available from the inventory records of Maneses Company for January:

                                                                                       Units            Unit Cost      Total Cost

Balance at January 1                                                     3,000               P9.77           P29,310

      Purchases:

            January 6                                                           2,000               10.30             20,600

            January 26                                                         2,700               10.71             28,917

 

      Sales:

            January 7                                                         (2,500)

            January 31                                                       (3,200)

Balance at January 31                                                   2,000

 

Assuming that Maneses does not maintain perpetual inventory records, what should be the inventory at January 31, using the weighted-average inventory method, rounded to the nearest peso?

The following information is available for Kerr Company for 2014:

                        Freight-in                                                                 P  60,000

                        Purchase returns                                                       150,000

                        Selling expenses                                                        300,000

                        Ending inventory                                                        520,000

            The cost of goods sold is equal to 300% of selling expenses.  What is the cost of goods available for sale?

  Transactions for the month of June were:

                                             Purchases                                                        Sales                

                        June  1     (balance)    1,200 @ P3.20                  June  2         900 @ P5.50

                                  3                        3,300 @   3.10                            6      2,400 @   5.50

                                  7                        1,800 @   3.30                            9      1,500 @   5.50

                                15                        2,700 @   3.40                          10         600 @   6.00

                                22                           750 @   3.50                          18      2,100 @   6.00

Assuming that perpetual inventory records are kept in pesos, the ending inventory on a FIFO basis is

  The balance in Indang Co.'s accounts payable account at December 31, 2014 was P400,000 before any necessary year-end adjustments relating to the following:

·         Goods were in transit to Indang from a vendor on December 31, 2014. The invoice cost was P50,000. The goods were shipped f.o.b. shipping point on December 29, 2014 and were received on January 4, 2015.

·         Goods shipped f.o.b. destination on December 21, 2014 from a vendor to Indang were received on January 6, 2015. The invoice cost was P25,000.

·         On December 27, 2014, Indang wrote and recorded checks to creditors totaling P30,000 that were mailed on January 10, 2015.

            In Indang's December 31, 2014 balance sheet, the accounts payable should be

Sloan Company, a wholesaler, budgeted the following sales for the indicated months:

                                                                       June                       July                     August  

            Sales on account                          P5,580,000            P5,720,000            P5,960,000

            Cash sales                                         360,000                 400,000                 520,000

            Total sales                                    P5,940,000            P6,120,000            P6,480,000

 

All merchandise is marked up to sell at its invoice cost plus 20%. Merchandise inventories at the beginning of each month are at 30% of that month's projected cost of goods sold.

The cost of goods sold for the month of June is anticipated to be