Problem 1 - Periodic Inventory - FIFO, LIFO, Weighted Average (WA)
Salandra Inc. buys engines, and then installs them in dirt bikes for weekend race enthusiasts. Inventory records of the engines for 2015 are shown below
|
DATE
|
|
UNITS
|
PER UNIT COST
|
TOTAL COST
|
|
1/1
|
Beginning Inventory
|
150
|
$120
|
$18,000
|
|
1/2
|
Bought
|
80
|
$124
|
$9,920
|
|
2/4
|
Sold
|
(96)
|
|
|
|
4/8
|
Bought
|
100
|
$132
|
$13,200
|
|
5/15
|
Bought
|
160
|
$136
|
$21,760
|
|
7/20
|
Sold
|
(200)
|
|
|
|
9/16
|
Bought
|
240
|
$140
|
$33,600
|
|
11/23
|
Sold
|
(400)
|
|
|
|
12/10
|
Bought
|
180
|
$144
|
$25,920
|
|
12/22
|
Sold
|
(60)
|
|
|
|
Cost of Goods Available for Sale
|
$122,400
|
|
Units Available for Sale (BI + units bought)
|
910 units
|
|
Units Sold
|
756 units
|
|
Ending Inventory
|
154 units
|
Part a. Assuming the Periodic System and FIFO, calculate Cost of Goods Sold and Ending Inventory.
Part b. Assuming the Periodic System and LIFO, calculate Cost of Goods Sold and Ending Inventory.
Problem 2 - Salandra Inc. buys engines, and then installs them in dirt bikes for weekend race enthusiasts. Inventory records of the engines for 2015 are shown below
|
DATE
|
|
UNITS
|
PER UNIT COST
|
TOTAL COST
|
|
1/1
|
Beginning Inventory
|
150
|
$120
|
$18,000
|
|
1/2
|
Bought
|
80
|
$124
|
$9,920
|
|
2/4
|
Sold
|
(96)
|
|
|
|
4/8
|
Bought
|
100
|
$132
|
$13,200
|
|
5/15
|
Bought
|
160
|
$136
|
$21,760
|
|
7/20
|
Sold
|
(200)
|
|
|
|
9/16
|
Bought
|
240
|
$140
|
$33,600
|
|
11/23
|
Sold
|
(400)
|
|
|
|
12/10
|
Bought
|
180
|
$144
|
$25,920
|
|
12/22
|
Sold
|
(60)
|
|
|
|
Cost of Goods Available for Sale
|
$122,400
|
|
Units Available for Sale (BI + units bought)
|
910 units
|
|
Units Sold
|
756 units
|
|
Ending Inventory
|
154 units
|
Part a. Assuming the Perpetual System and LIFO, calculate Cost of Goods Sold and Ending Inventory
Part b. Assuming the Perpetual System and WA, calculate Cost of Goods Sold and Ending Inventory
Problem 3 - Review the unadjusted trial balance below and prepare adjusting journal entries to record the various described items below. Record in the space provided at the bottom of this spreadsheet. After completing journal entries, complete the adjusted trial balance below. Lastly complete the income statement, balance sheet and statement of retained earnings. The balance sheet must balance. The accounting equation is Assets = Liabilities + Equity.
|
Baltimore Corporation Unadjusted Trial Balance January 31, 2016
|
|
|
|
|
|
|
Debits
|
Credits
|
|
Cash
|
$ 37,500
|
$ -
|
|
Accounts receivable
|
12,410
|
-
|
|
Prepaid insurance
|
2,400
|
-
|
|
Supplies inventory
|
7,113
|
-
|
|
Equipment
|
35,000
|
-
|
|
Accumulated depreciation
|
-
|
10,000
|
|
Accounts payable
|
-
|
7,569
|
|
Salaries payable
|
-
|
-
|
|
Interest payable
|
-
|
-
|
|
Unearned revenue
|
-
|
8,500
|
|
Loan payable
|
-
|
11,500
|
|
Capital stock
|
-
|
25,000
|
|
Retained earnings, Jan. 1
|
-
|
15,457
|
|
Revenues
|
-
|
43,995
|
|
Depreciation expense
|
-
|
-
|
|
Interest expense
|
-
|
-
|
|
Insurance expense
|
-
|
-
|
|
Office expense
|
2,500
|
-
|
|
Rent expense
|
13,000
|
-
|
|
Salary expense
|
12,098
|
-
|
|
Supplies expense
|
-
|
-
|
|
Utilities expense
|
-
|
-
|
|
|
$ 122,021
|
$ 122,021
|
1. Baltimore Corporation's equipment had an original life of 140 months, and the straight-line depreciation method is used. As of January 1, the equipment was 40 months old. The equipment will be worthless at the end of its useful life.
2. As of the end of the month, Baltimore Corporation has provided services to customers for which the earnings process is complete. Formal billings are normally sent out on the first day of each month for the prior month's work. January's unbilled work is $25,000.
3. Utilities used during January, for which bills will soon be forthcoming from providers, are estimated at $1,500.
4. A review of supplies on hand at the end of the month revealed items costing $3,500.
5. The $2,400 balance in prepaid insurance was for a 6-month policy running from January 1 to June 30.
6. The unearned revenue was collected in December of 2014. 60% of that amount was actually earned in January, with the remainder to be earned in February.
7. The loan accrues interest at 1% per month. No interest was paid in January.
8. At month end, salaries of $2,120 have been earned but not paid.
Attachment:- Assignment.rar