Advanced Accounting by Guerrero

1
CHAPTER 2
Multiple Choice Questions Theoretical
1.
2.
3.
4.
5.
c
b
a
b
a
6.
7.
8.
9.
10.
b
c
b
b
a
11.
12.
13.
14.
15.
a
a
a
a
a
Multiple Choices - Computational

1.
(a)
10,000 x P500
10,000
2.
P1 x .20 x 10,000
2
(a)
1,000 + 1,500 = (100x 20) + SSQ
SSQ = 500 units
3.
(a)
EOQ =
2 x 5,200 x P250
P5
= 721
4.
(a)
5,200/721 = 7.2
5.
(a)
D = 10,000, P = P225, C = P225
EOQ =
2 DP
C
2 x 10,000 x P225
10
= 670.82
= 671 jerseys
6.
(a)
Number of orders per year =
=
=
D
EOQ
14.90
15 orders
10,000
671
P1,500
2
7.
(a)
Demand each
Working day
D
Number of working days
10,000
365
27.40 jerseys per day
Purchase lead time = 7 days

Reorder point
= 27.40 x 7
= 191.80 or 192 jerseys
8.
(a)
2
9.
x 50,000 x P5
P2
500
(a)
[(10,000 / 250) x 30]
+ [(70 - 30) x 40]
30 ( 10,000 / 250) + 40 ( 70 - 30) = 2,800

10.
11.
(a)
Safety
Stock
Expected
Stockout
Stockhout
Cost
10
20
50
55
2.5
1.5
.5
.25
P200
120
40
20
P 20
60
100
110
(a)
(1,400 - 600)
12.
Carrying
Cost
+ 2,000 = 2,800
(a)
P800
P.12 + P.10 + 10,000 = .30
13.
(a)
SS
OP
=
=
(7,200 / 2,400) x (45 20)

20 (7,200 / 240) + 750
= 750
= 1,350
Stockhout and
Carrying costs
P220
180
140
130
3
14.
(a)
2 x RU x CO
CU x CC
2 x 1,000 x P50
P100 x .15625
EOQ
6,400
= 6400
= 80
15.
(a)
Order Cost
= RU x CO
EOQ
= 1,000 x P50
80
= P625
16.
(a)
CC
17.
=
=
=
x EOQ x CU x CC
x 80
x P100 x .15625
P625
(a)
140 + (100 x 7 days) = 840
18.
(a)
140 + (1,000 / 2) = 640
19.
(a)
140 + 1,000 = 1,140
20.
(a)
1,000 =
2 x 25,000 x CO
P1
1,000 =
50,000 x CO
1,000,000 = P50,000 x CO
CO
= P20
4
21.
(a)
EOQ
22.
2 x 20,000 x P160
P1.60
2,000 yards.
(a)
20,000 / 2,000 = 10 order
23.
(a)
Demand each working day
=
=
=
=
Annual demand / No. of working days

20,000/250
80 yards per day
400 yards per weedl
Purchasing lead time

Reorder point
=
=
2 weeks
400 x 2 = 800 yards
SOLUTIONS TO PROBLEMS
Problem 2-1
1.
Purchase Order:
Big Manufacturers
123 Molave Street
Fairview Ave., QC
Purchase Order 144

Date 4/4/08
To:
Shipping Instructions
Date Wanted 4/17/08
Small Products
54 West Avenue
Cebu City
Quantity
Description
4,390
840
1,890
By
2.
103 2 x 4 plastic sheeting

Unit Price
Amount
P1.20
1.90
2.60
P5,268.00
1,596.00
4,914.00
P11,778.00
(Students Name)
Purchasing Agent
Charge: ACCT. 121

Job________
Dept. ______
Receiving Report
Big Manufacturers
123 Molave Street
Fairview Ave., QC
Receiving Report
Received From:
Date Received 4/4/08

Purchase Order No. 144
Invoice No.
539
Ship Via
Quantity
Received
4,390
84
1,890
Small Products
54 West Avenue
Cebu City
Fedex
Tansport Charges
Quantity
Accepted
4,250
840
1,890
Prepaid Received By
Quantity
Rejected
140
-0-0-
403
(Students Name)
Description
Weight
103-2x4 plastic sheeting

425 k
210 k
945 k
Inspection Record
Quantity
Accepted
4,250
Date
Quantity
Returned
140
Reason for Rejection

Imperfections in the sheets. Do not replace
Inspected by
( Students Name)
6
3.
4.
Debit Memorandum
Big Manufacturers
123 Molave Street
Fairview Ave., QC
Debit Memorandum No.
To:
Date
4/19/2008
Invoice No.
539
Invoice Date
4/17/2008
Small Products
54 West Avenue
Cebu City
Quantity
Purchase
Order No.
Description
Unit
Price
Amount
140
644
P1.20
P168.00
Explanation
Crack in the sheets. Do not replace.
Returned Via
Fedex
085
(Students Nam)
Purchasing Agent
Disbursement Voucher
DISBURSEMENT VOUCHER
Big Manufacturers
123 Molave Street
Fairview Ave., QC
Payee
Voucher No.
Issued Date
Due Date
0740
4/19/2008
5/27/2008
Small Products
54 West Avenue
Cebu City
Invoice Date
Terms
4/17/2008
2/10, n/30
Invoice No.
539
Less DM 085
Amount
P 11,778.00
168.00
P 11,610.00
Destribution
Account No.
121
5.
Amount
P11,610.00
Check No. BPI 000127

Approved By
A request for a purchase must be made by an authorized person.

A purchase order must be prepared and approved by an authorized person.
All materials must be checked to see that they correspond to the purchase order and are in
good condition.
Payment is made only after proper approval.
Various steps in the purchasing procedures are delegated to different persons to lessen the risk
of fraud or error.
7
Problem 2-2
2008
Oct. 24:
25:
Materials
Vouchers payable
To record voucher to Veterans Corp.
On invoice of October 21 for 4,800 units,
Of which 510 were returned.
92,235.00
Vouchers payable
Purchase discounts
Cash
To record payment of Voucher 014
Note: No journal entries are needed for the
Transactions on October 4, 5, and 21.
92,235.00
92,235.00
922.35
91,131.65
Problem 2-3
VOUCHER REGISTER
Date
March
Voucher
No.
031
032
033
034
Payable to
Lim Supply Company
Tan Corporation
Sy Company
Ong Company
For the Month of March, 2008

Paid
Date
Check. No.
Voucher
Payable
Cr 201
Materials
Dr. 121
P17,871.00
42,930.50
16,896.00
208,821.00
286,518.50
P17,871.00
42.930.50
16,896.00
208,821.00
286,518.50

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1

Multiple Choices - Computational

Purchase lead time = 7 days

+ [(70 - 30) x 40]

30 ( 10,000 / 250) + 40 ( 70 - 30) = 2,800

(7,200 / 2,400) x (45 20)

Annual demand / No. of working days

Purchasing lead time

Purchase Order 144

103 2 x 4 plastic sheeting

Charge: ACCT. 121

Date Received 4/4/08

103-2x4 plastic sheeting

Reason for Rejection

Debit Memorandum No.

103 2 x 4 plastic sheeting

Crack in the sheets. Do not replace.

Check No. BPI 000127

A request for a purchase must be made by an authorized person.

For the Month of March, 2008

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