Questions from Financial Accounting

Q: Spritzer Company made sales of $24,000 million during 2016

Spritzer Company made sales of $24,000 million during 2016. Cost of goods sold for the year totaled $11,040 million. At the end of 2015, Spritzer’s inventory stood at $1,000 million, and Spritzer ende...

Q: Metro Technology began the year with inventory of $299,000

Metro Technology began the year with inventory of $299,000 and purchased $1,820,000 of goods during the year. Sales for the year are $3,887,500, and Metro Technology’s gross profit percentage is 60% of...

Q: Determine whether each of the following actions in buying, selling,

Determine whether each of the following actions in buying, selling, and accounting for inventories is ethical or unethical. Give your reason for each answer. 1. In applying the lower-of-cost-or-marke...

Q: Richardson Supply’s $3.9 million cost of inventory at the

Richardson Supply’s $3.9 million cost of inventory at the end of last year was understated by $1.2 million. 1. Was last year’s reported gross profit of $2.9 million overstated, understated, or correc...

Q: Here is the original schedule of cost of goods sold for Truman

Here is the original schedule of cost of goods sold for Truman Company for the years of 2014 through 2017: During the preparation of its 2017 financial statements, Truman Company disc...

Q: Rootstown Company sold 10,000 jars of its organic honey in

Rootstown Company sold 10,000 jars of its organic honey in the most current year for $8 per jar. The company had paid $3.50 per jar of honey. (Assume that sales returns are nonexistent.) Calculate the...

Q: Trinkets Unlimited made total purchases of $250,000 in the

Trinkets Unlimited made total purchases of $250,000 in the most current year. It paid freight in of $3,000 on its purchases. Freight out (the cost to deliver the merchandise to its customers) totaled...

Q: McDonough Copy Center sells laser printers and supplies. Assume McDonough Copy

McDonough Copy Center sells laser printers and supplies. Assume McDonough Copy Center started the year with 100 containers of ink (average cost of $8.00 each, FIFO cost of $8.60 each, LIFO cost of $7....

Q: McDonough Copy Center is a corporation subject to a 30% income

McDonough Copy Center is a corporation subject to a 30% income tax. Compute McDonough Copy Center’s income tax expense under the average, FIFO, and LIFO inventory costing methods. Which method would y...

Q: Marley Corporation uses the LIFO method to account for inventory. Marley

Marley Corporation uses the LIFO method to account for inventory. Marley is having an unusually good year, with net income well above expectations. The company’s inventory costs are rising rapidly. Wh...