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Corresponds to CLO 5(a) As of December 31, Gammelguard Corporation

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Question;Corresponds to CLO 5(a)As of December 31, Gammelguard Corporation has outstanding accounts receivable of $2.4 million. Sales on credit during the year were $9 million. The allowance for doubtful accounts has a credit balance of $20,000. If the company estimates that 7% of its outstanding receivables will be uncollectible, what will be the amount of bad debt expense recognized for the year? (Points: 6)$630,000$188,000$168,000$148,000Question 18. 18. Corresponds to CLO 5(b)As of December 31, Wiliams Corporation has outstanding accounts receivable of $3.6 million. Sales on credit during the year were $12.5 million. The allowance for doubtful accounts has a credit balance of $62,000. If the company estimates that 1% of its net credit sales will be uncollectible, what will be the amount of bad debt expense recognized for the year? (Points: 6)$63,000$125,000$187,000$360,000Question 19. 19. Corresponds to CLO 5(c)Kandris Corporation had a balance in accounts receivable of $600,000 and a balance in allowance for doubtful accounts of $55,000, when management decided the account receivable from Dunn Corporation of $2,000 had become uncollectible. What journal entry should Kandris Corporation make to write-off the uncollectible account? (Points: 6)Debit Bad Debt Expense, credit Allowance for Doubtful Accounts, $2,000Debit Accounts Receivable, credit Allowance for Doubtful Accounts, $2,000Debit Allowance for Doubtful Accounts, credit Accounts Receivable, $2,000Debit Allowance for Doubtful Accounts, credit Bad Debt Expense, $2,000Question 20. 20. Corresponds to CLO 5(d)At December 31, Norman Industrial Inc. had account balances before year-end adjusting entries for accounts receivable and the related allowance for doubtful accounts of $850,000 and $79,000 respectively. An aging of accounts receivable indicated that $88,000 of December 31, receivables are expected to be uncollectible. The net realizable value of accounts receivable after adjustment is (Points: 6)$938,000$929,000$771,000$762,000Question 21. 21. Corresponds to CLO 6(a)The following is a record of Axis Corporation's inventory transactions for the current month:June 1 Balance, 400 units @ $65 each June 16 Sale, 500 units @ $90June 14 Purchase 900 units @ $68 each June 20 Sale, 300 units @ $90June 25 Purchase 250 units @ $70 eachAxis uses the periodic inventory system. Using the FIFO method, what is the amount of cost of goods sold for the month?(Points: 6)$51,500$52,000$53,200$54,900Question 22. 22. Corresponds to CLO 6(b)The following is a record of Meyer Corporation's inventory transactions for the current month:October 1 Balance, 600 units @ $24 each October 9 Sale, 600 units @ $51October 12 Purchase 550 units @ $26 each October 19 Sale, 500 units @ $51October 25 Purchase 700 units @ $27 eachMeyer uses the periodic inventory system. Using the LIFO method, what is the amount of ending inventory on October 31?(Points: 6)$18,300$20,200$18,000$29,300Question 23. 23. Corresponds to CLO 6(c)The following is a record of Tiller Corporation's inventory transactions for the current month:January 1 Balance, 500 units @ $10 each January 5 Sale, 290 units @ $25January 11 Purchase, 300 units @ $12 each January 13 Sale, 250 units @ $25January 23 Purchase, 400 units @ $13 each January 27 Sale, 310 units @ $25Tiller uses the periodic inventory system. Using the weighted-average inventory method, what is the cost of goods sold for the month of January?(Points: 6)$14,004$9,775$4,085$4,025Question 24. 24. Corresponds to CLO 6(d)The following is a record of Caulder Corporation's inventory transactions for the current month:March 1 Balance, 500 units @ $40 each March 12 Sale, 200 units @ $85March 16 Purchase, 300 units @ $42 each March 22 Sale, 350 units @ $85March 28 Purchase, 300 units @ $43 eachCaulder uses the perpetual inventory system. Using the LIFO method, what is the ending inventory on March 31?(Points: 6)$22,900$22,100$22,600$23,400Question 25. 25. Corresponds to CLO 7(a)In the context of dollar-value LIFO, when inventory in base year dollars decreases, (Points: 6)The LIFO reserve increaseA LIFO layer is liquidatedA LIFO layer is createdThe LIFO price index decreasesQuestion 26. 26. Corresponds to CLO 7(b)Hemmer Corporation adopted the dollar-value LIFO method of inventory valuation on December 31, 2011. Its inventory at that date was 450,000 and the relevant price index was 100. Information regarding inventory for subsequent years is as follows:Date Inventory at Current Prices Current Price IndexDecember 31, 2012 $513,600 107December 31, 2013 $580,000 125December 31, 2014 $650,000 130What is the ending inventory at December 31, 2012 under dollar-value LIFO?(Points: 6)$464,000$464,980$482,100$497,080Question 27. 27. Corresponds to CLO 7(c)What is primary purpose of stating inventories at lower-of-cost-or-market? (Points: 6)To report a loss when there is a decrease in the future utility below the original costTo be conservativeTo report a loss whenever there is a decrease in the future utilityTo permit future profits to be recognizedQuestion 28. 28. Corresponds to CLO 7(d)If the historical cost of product X is $55, the selling price of product X is $90, the costs to sell product X are $14, the replacement cost for product X is $50, and the normal profit margin is 30% of sales price, what is the market value that should be used in the lower-of-cost-or-market comparison? (Points: 6)$50$49$76$55Question 29. 29. Corresponds to CLO 8(a)Energy Solutions Corporation estimates the cost of its physical inventory at November 30 for use in an interim financial statement. Management uses a gross profit rate on sales of 40%. The following information is available:Inventory, November 1 $500,000Purchases during November $650,000Sales during November $900,000The estimated cost of inventory at November 30 is(Points: 6)$360,000$540,000$610,000$650,000Question 30. 30. Corresponds to CLO 8(b)How is the gross profit method used as it relates to inventory valuation? (Points: 6)To provide an inventory value of LIFO inventories.To estimate inventories for annual statements.To verify the accuracy of the perpetual inventory records.To verify the accuracy of the physical inventory.Question 31. 31. Corresponds to CLO 8(c)Arrow Corporation uses the conventional retail inventory method to value its merchandise inventory. The following information is available for the current year:Cost RetailBeginning Inventory $30,000 $50,000Purchases $180,000 $250,000Freight-In $2,500 ----Net Markups $8,500Net Markdowns $10,000Employee Discounts $1,000Sales $205,000What is the cost to retail ratio?(Points: 6)68.88%68.07%70.35%70.83%Question 32. 32. Corresponds to CLO 8(d)Capital City Corporation uses the conventional retail inventory method to determine its ending inventory at cost. The following information is available for the current year:Cost RetailBeginning Inventory $350,000 $500,000Purchases $1,600,000 $2,440,000Net Markups $60,000Net Markdowns $30,000Sales $2,350,000Capital City determines that the cost-to-retail ratio is 65%. What is the ending inventory at cost?(Points: 6)$620,000$350,000$470,000$403,000

 

Paper#52417 | Written in 18-Jul-2015

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