Problem15

The cost of inventory of coffee beans 1,850,000

LCRNV 50,000

Adjustment as of December 31, 2021

Inventory 1,850,000
Allowance to reduce inventory cost
of net realizable net value 150,000
Inventory at NCR 1,700,000
Problem16

Carrying Value, January 1, 2020

2 year old hogs 9,000 x 20 = 180,000

2.5 year old hogs 19,000 x 10 = 190,000
1 year old horses 43,333 x 15 = 650,000
3 year old cattle 95,000 x 10 = 950,000

Purchases on June 30, 2020

1.5-year-old Hogs 15,333 x 15 = 230,000

Fair value less cost to sell on December 31, 2020

Changes in the fair value
2-year old Hogs 9,525 x 20 = 950,000 180,000 - 9,525 = 170,475
2.5-year old Hogs 20,100 x 10 = 201,000 190,000 - 20,100 = 169,900
1-year old Horses 45,000 x 15 = 675,000 650,000 - 45,000 = 605,000
3-year old Cattle 92,500 x 10 = 925,000 950,000 - 92,500 = 857,500
1.5 year old Hogs 16,000 x 15 = 240,000 230,000 - 16,000 = 214,000

Fair value less cost to sell on December 31, 2020

3-year old Hogs 10,125 x 20 = 202,500

3.5-year old Hogs 20,400 x 10 = 204,000
2-year old Horses 44,667 x 15 = 670,000
4-year old Cattle 93,500 x 10 = 935,000
2-year old Hogs 16,4333 x 15 = 246,500

1-Jan-20 Biological Asset 1,970,000

Cash 1,970,000
30-Jun-20 Biological Asset 2,016,875
Cash 2,016,875

31-Dec-20 Biological Asset 46,875

Unrealized holding gain 46,875
To record the changes
Problem17

Beginning Inventory 1,000,000

Purchases, January 1 to January 15,2020 500,000
Sales, January 1 to January 15,2020 800,000

2019 2018
Sales 4,500,000 4,100,000
Cost of Sales 2,300,000 2,500,000

Requirements:
1. Compute the gross profit rate of the company for the fast years

2020 2019 2018

41.24% 51.11% 60.98%

2. Compute the inventory lost in monsoon

Beginning Inventory 1,000,000

Add: Purchases 500,000
Total goods Available for Sale 1,500,000
Less: Cost of Goods Sold 470,000
1,030,000

800,000 x 58.76% = 470,080

Problem18

Requirements:
1.Purchases 2,190,000
2. Sales 3,080,000
3. Inventory Loss 2,204,800

2020 2019 2018 2017 A/R

42% 40% 38% 36% Debit Credit
510,000 3,100,000
Sales - 3,080,000
Beginning Inventory 750,000
Add: Purchases 3,080,000 490,000
Goods Avail for Sale 3,830,000

Ending Inventory 2,559,800

Goods out on Consignment -310,000 A/P
Debit Credit
Salvage Value of Inventory -45,000 1950000 350,000
Inventory Loss 2,204,800 2,190,000

590,000 - Purchases
PROBLEM 19
March 31, 2020
Accounts Receivable 1,050,000 Accounts Payable - Apr. 30 (shipments) 410,000
Inventory - Jan. 1 2,100,000 Payment for shipments 120,000
Accounts Payable 800,000 Purchases: April 530,000
Sales 4,000,000 Purchases: March 2,000,000
Purchases 2,000,000 Total Purchases 2,530,000

Additional Information: Accounts Receivable - April 30 1,100,000

Accounts Payable as of Mar. 31 300,000 Writeoff 60,000
Merchandise Shipment 120,000 Collections (500,000-50,000) 450,000
Expenses 190,000 Total 1,610,000
Collections from Customers 500,000 Less: AR March 31 1,050,000
Merchandise Returned 50,000 Sales: April 560,000
Indebtedness (AR at Apr. 30) 1,100,000 Sales: March 4,000,000
Never Recovered (writeoffs) 60,000 Total Sales 4,560,000
Uncollectible (ADA) 55,000
Merchandise Shipment (AP - unrecorded obligation) 410,000 Inventory - Jan. 1 2,100,000
Shipments in Transit (GIT) 60,000 Purchases 2,530,000
Gross Profit Rate 40% Purchase Returns 50,000
Sold Inventory (salvage value) 150,000 Goods Available for Sale 4,580,000
Cost of Goods Sold 2,736,000
Inventory Apr. 30 1,844,000
Less:
Goods in Transit 60,000
Salvage Value 150,000 210,000
Inventory Loss 1,634,000
Sales (100%) 4,560,000
COGS (60%) 2,736,000
Gross Profit (40%) 1,824,000

Requirements:
1. Purchases 2,530,000
2. Sales 4,560,000
3. Estimated Ending Inventory 1,844,000
4. Inventory Loss 1,634,000
PROBLEM 20 Cost Retail NRV - AVERAGE Cost Retail
Inv. Beg. 350,000 650,000 Inv.Beg. 350,000 650,000
Purchases 2,900,000 4,800,000 Purchases 2,900,000 4,800,000
Purchase Returns 100,000 175,000 P Returns 100,000 175,000
Purchase Discounts 210,000 P Discounts 210,000
Gross Sales 5,000,000 Freight In 230,000
Sales Returns 200,000 Markup 150,000
Sales Discounts 115,000 Markup Cancellations 70,000
Markups 150,000 Total Goods Available for Sale - NRV 3,170,000 5,355,000
Markups Cancellation 70,000 cost ratio 59.20%
Markdowns 60,000 Markdown 60,000
Markdowns Cancellation 0 Markdown Cancellations -
Freight In 230,000 Total Goods Available for Sale - Average 3,170,000 5,295,000
Estimated Normal Shrinkage (2% of sales) 100,000 cost ratio 59.87%
Shoplifting Losses (abnormal) 50,000 Less:
Sales 5,000,000
Sales Returns/Allow 200,000
Normal Shrinkage 100,000
Requirements: Shoplifting Lossses 50,000 4,950,000
1. LCNRV Approach 204,240
2. Average Approach 206,552 Ending Inventory 345,000
3. FIFO Approach 209,450 Ending Inventory at cost:
LCNRV 204,240
Average 206,552
 FIFO METHOD Cost Retail
Beg. Inv. 350,000 650,000
Purchases 2,900,000 4,800,000
P Return 100,000 175,000
P Discount 210,000
Freight In 230,000
Markup 150,000
Markup Cancellation 70,000
Markdown 60,000
59.20% Mardown Cancellation -
Current Year Cost 2,820,000 4,645,000
cost ratio 60.71% 0.607104
Total Goods Available for Sale 3,170,000 5,295,000
59.87%
Sales 5,000,000
Sales Returns/Allow 200,000
Employee Discounts 100,000
Normal Inv. Loss 50,000 4,950,000
Ending Inv. 345,000

Ending Inv at Cost FIFO 209,450