Question;Problem;5- 33 Effect of different inventory cost flow;methods on financial statements The accounting records of Clear Photography;Inc., reflected the following balances as of January 1, 2012;Cash $ 18,000;Beginning inventory 13,500 (150 units;$ 90);Common stock 15,000;Retained earnings 16,500;The following five transactions occurred;in 2012: 1. First purchase (cash) 120 units @ $ 92 2. Second purchase (cash);200 units @ $ 100 3. Sales (all cash) 300 units @ $ 185 4. Paid $ 15,000 cash;for operating expenses. 5. Paid cash for income tax at the rate of 40 percent;of income before taxes. Required a. Compute the cost of goods sold and ending;inventory, assuming (1) FIFO cost flow, (2) LIFO cost flow, and (3);weighted- average cost flow. b. Use a vertical model to prepare the 2012 income;statement, balance sheet, and statement of cash flows under FIFO, LIFO, and;weighted average. (Hint: Record the events under an accounting equation before;preparing the statements.);Problem;6- 25 Calculating depreciation expense using;four different methods O?Brian Service Company purchased a copier on January 1;2012, for $ 17,000 and paid an additional $ 200 for delivery charges. The;copier was estimated to have a life of four years or 800,000 copies. Salvage;was estimated at $ 1,200. The copier produced 230,000 copies in 2012 and;250,000 copies in 2013. Required Compute the amount of depreciation expense for;the copier for calendar years 2012 and 2012, using these methods;a. Straight- line.;b. Units- of- production.;c. Double- declining- balance.
Paper#41026 | Written in 18-Jul-2015Price : $27