Purchase returns and allowances Sales Sales Returns and allowances 46,120 788,000 16,000 64,600 836,000 20,000 On January 1, 2023, Shark's pricing policy was changed so that the gross profit rate would be three percentage points higher than the one earned in 2022. Salvaged undamaged merchandise was marked to sell at P24,000 while damaged merchandise marked to sell at P16,000 had an estimated realizable value of P3,600. 1. What is the company's gross profit rate beginning January 1, 2023? A. 24% B. 21% C. 17% D. 20% 2. How much is the inventory fire loss? A. P189,400 B. P 183,640 C. P 164,920 D. P 254,000

Purchase returns and allowances Sales Sales Returns and allowances 46,120 788,000 16,000 64,600 836,000 20,000 On January 1, 2023, Shark's pricing policy was changed so that the gross profit rate would be three percentage points higher than the one earned in 2022. Salvaged undamaged merchandise was marked to sell at P24,000 while damaged merchandise marked to sell at P16,000 had an estimated realizable value of P3,600. 1. What is the company's gross profit rate beginning January 1, 2023? A. 24% B. 21% C. 17% D. 20% 2. How much is the inventory fire loss? A. P189,400 B. P 183,640 C. P 164,920 D. P 254,000

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter22: Accounting For Changes And Errors.

Section: Chapter Questions

Problem 11RE: At the end of 2019, Manny Company recorded its ending inventory at 350,000 based on a physical...

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At the end of 2019, Manny Company recorded its ending inventory at 350,000 based on a physical count. During 2020, the company discovered that the correct inventory value at the end of 2019 should have been 400,000 because it made a counting error. Upon discovery of this error in 2020, what correcting journal entry will Manny make? Ignore income taxes.
Whale Inc. was organized on January 1, 2020. December 31, 2021, the company lost most of its inventory in a warehouse fire just before the year-end count of inventory was to take place. The company's records disclosed the following data: 2020 2021 Inventory, Jan. 1 204,000 Purchases 860,000 692,000 Purchase returns and allowance 46,120 64,600 Sales 788,000 836,000 Sales returns and allowances 16,000 20,000 On January 1, 2021, Whale's pricing policy was changed so that the gross profit rate would be three percentage higher than the one earned in 2020 Salvaged undamaged merchandise was marked to sell at P24,000 while damaged merchandise marked to sell at P16,000 had an estimated realizable value of P3,600. REQUIRED: a. What is the company's gross profit rate beginning January 1, 2021? b. How much is the inventory fire lost?
On April 10, 2023, a fire damaged the office and warehouse of Sill Company. Most of the accounting records were destroyed, but the following account balances were determined as of March 31, 2023: Sales Revenue (January 1-March 31, 2023), $180,000; Purchases (January 1- March 31, 2023), $94,000. The company's fiscal year ends on December 31. It uses a periodic inventory system. From an analysis of the April bank statement, you discover cancelled checks of $4,200 for cash purchases during the period April 1-10. Deposits during the same period totaled $18,500. Of that amount, 60% were collections on accounts receivable related to sales made in prior periods, and the balance was cash sales. Correspondence with the company's principal suppliers revealed $12,400 of purchases on account from April 1 to April 10. Of that amount, $1,600 was for merchandise in transit on April 10 that was shipped FOB destination. Correspondence with the company's principal customers produced acknowledgments of…
1. What is the company's gross profit rate beginning January 1, 2021? A. 17% B. 20% C. 21% D. 24% 2. How much is the inventory fire loss? A. 146,920 B. 183,640 C. 189,400 D. 254,000
On January 15, 2020, a strong monsoon hit the country and destroyed all the inventory of Aeirron Company stored in the warehouse. The following information is available from the records of the company’s periodic inventory system:Beginning inventory P1,000,000Purchases, January 1 to January 15, 2020 500,000Sales, January 1 to January 15, 2020 800,000 The following are the past performance of Aeirron Company:2019 2018Sales P4,500,000 P4,100,000Cost of Sales 2,300,000 2,500,000Requirements:1. Compute the gross profit rate of the company for the past years.2. Compute the inventory lost in monsoon.
The following inventory transactions took place near December 31, 2021, the end of the Rasul Company's fiscal year-end: 1. On December 27, 2021, merchandise costing $2,000 was shipped to the Myers Company on consignment. The shipment arrived at Myers's location on December 29, but none of the merchandise was sold by the end of the year. The merchandise was not included in the 2021 ending inventory. 2. On January 5, 2022, merchandise costing $8,000 was received from a supplier and recorded as a purchase on that date and not included in the 2021 ending inventory. The invoice revealed that the shipment was made f.o.b. shipping point on December 28, 2021. 3. On December 29, 2021, the company shipped merchandise costing $12,000 to a customer f.o.b. destination. The goods, which arrived at the customer's location on January 4, 2022, were not included in Rasul's 2021 ending inventory. The sale was recorded in 2021. 4. Merchandise costing $4,000 was received on December 28, 2021, on…
Crane Company lost all of its inventory in a fire on December 26, 2022. The accounting records showed the following inventory- related data for November and December. November December (to 12/26) Net sales $600,000 $700,000 Beginning inventory 30,000 36,000 Purchases 392,000 420,000 Purchase returns and allowances 13,500 14,500 Purchase discounts 8,500 9,500 Freight-in 8,000 9,900 Ending inventory 36,000 ? Crane is fully insured for fire losses but must prepare a report for the insurance company. (a) Your answer is correct. Compute the gross profit rate for November. (b) Gross profit rate eTextbook and Media × Your answer is incorrect. 38 % Using the gross profit rate for November, determine the estimated cost of the inventory lost in the fire. Estimated inventory lost in fire +A $ 22000 Assistance Used Attempts: 2 of 5 used
During the year ended December 31, 2021, Angel Company revealed the following events: a) A counting error relating to inventory on December 31, 2020 was discovered. This required an increase in the carrying amount of inventory on that date of P500,000. b)It was also decided to write off P50,000 from inventory which was over two years old as it was obsolete. c) The provision for uncollectible accounts on December 31, 2020 was P200,000. During 2021, an amount of P300,000 was written off on the December 31, 2020 accounts receivable. What pretax adjustment is required to restate retained earnings on January 1, 2021? Your answer
Crane Company sells TVs. The perpetual inventory was stated as $37,300 on the books at December 31, 2020. At the close of the year, a new approach for compiling inventory was used and apparently a satisfactory cut-off for preparation of financial statements was not made. Some events that occurred are as follows. 1. TVs shipped to a customer January 2, 2021, costing $5,100 were included in inventory at December 31, 2020. The sale was recorded in 2021. 2. TVs costing $15,900 received December 30, 2020, were recorded as received on January 2, 2021. 3. TVs received during 2020 costing $4,000 were recorded twice in the inventory account. 4. TVs shipped to a customer December 28, 2020, f.o.b. shipping point, which cost $9,400, were not received by the customer until January, 2021. The TVs were included in the ending inventory. 5. TVs on hand that cost $6,700 were never recorded on the books. Compute the correct inventory at December 31, 2020.
Sharp Company received P 80,000 of inventory items on the last day of its fiscal year, May 31, 2022. The company employees a periodic inventory system. During your audit, you discovered the following: 1. Items Alpha were included in inventory at May 31, 2022, but the purchase was not recorded until June 3, 2022, P 100,000. 2. Items Bravo were excluded from the May 31, 2022 inventory, but the purchase was recorded on May 31, 2022, P 60,000. 3. Items Charlie were excluded from the May 31, 2022 inventory, the purchase was not recorded until June 3, 2022, P 50,000. Question: What is the net effect on net income of the errors?
During the year ended December 31, 2021, Angel Company revealed the following events: a) A counting error relating to inventory on December 31, 2020 was discovered. This required an increase in the carrying amount of inventory on that date of P500,000. b)It was also decided to write off P50,000 from inventory which was over two years old as it was obsolete. c) The provision for uncollectible accounts on December 31, 2020 was P200,000. During 2021, an amount of P300,000 was written off on the December 31, 2020 accounts receivable. What pretax adjustment is required to restate retained earnings on January 1, 2021?
During the year ended December 31, 2021, Samar Company Problem 8-24 (IFRS) revealed the following events: A counting error relating to inventory on December 31, 2020 was discovered. This required a reduction in the carrying amount of inventory on that date of P2,000,000. The provision for uncollectible accounts receivable on December 31, 2020 was P500,000. During 2021, an amount of P800,000 was written off the December 31, 2020 accounts receivable. What pretax adjustment is required to restate retained earnings on January 1, 2021? a. 2,000,000 b. 2,500,000 c. 2,300,000 d.