Question 1.Which of the following items would be included in the Goodwill asset?patents, trademarks, customers lists, synergies & brand names
Question2.Corporation S sold investment land to Corporation P for $100,000 cash. Corporation S's
basis in the land was $167,000. Mr. and Mrs. J own 100 percent of the stock of both corporations.
a) What is Corporation P's tax basis in the investment asset purchased from Corporation S?
b) Corporation P holds the land as an investment for seven years before selling it to an unrelated buyer. Compute the gain or loss recognized by Corporation P if the amount realized on the sale is (1) $175,000, (2) $120,000, or (3) $95,000.
Question3.A manufacturing company that produces a single product has provided the following
data concerning its most recent month of operations:
Selling price = $123
Unit in beginning inventory = 0
Units produced = 1,000
Units sold = 900
Units in ending inventory = 100
Variable costs per unit:
Direct materials = $41; Direct labor = $26; VMOH = $4; Variable selling and administrative =$6
Fixed costs:
FMOH = $17,000; Fixed selling and administrative = $11,700
What is the net operating income for the month under variable costing?
Question4.compute the cost of not taking the following cash discounts.
a. 2/10, net 40
b. 2/15, net 30
c. 2/10, net 45
d. 3/10, net 90
Question5. Perpetual Inventory Using FIFO
Beginning inventory, purchases, and sales data for portable DVD players are as follows:
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June 1
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Inventory
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69 units @ $45
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6
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Sale
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55 units
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14
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Purchase
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36 units @ $47
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19
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Sale
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23 units
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25
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Sale
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16 units
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30
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Purchase
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21 units @ $50
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The business maintains a perpetual inventory system, costing by the first-in, first-out method.
Determine the cost of the merchandise sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 4.
a. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Merchandise Sold Unit Cost column and in the Inventory Unit Cost column.
Cost of the Merchandise Sold Schedule
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First-in, First-out Method
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Portable DVD Players
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Date
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Quantity Purchased
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Purchases Unit Cost
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Purchases Total Cost
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Quantity Sold
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Cost of Merchandise Sold Unit Cost
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Cost of Merchandise Sold Total Cost
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Inventory Quantity
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Inventory Unit Cost
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Inventory Total Cost
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June 1
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69
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$45
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$3105
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June 6
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$
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$
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June 14
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$
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$
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June 19
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June 25
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June 30
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June 30
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Balances
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$
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$
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For June 6, it asks for quantity sold, cost of merchandise sold unit cost, cost of merchandise sold total cost, inventory quantity, inventory unit cost, inventory total cost
For June 14 it asks for quantity purchased, purchases unit cost, purchases total cost, inventory quantity, inventory unit cost, inventory total cost; then spaces under the inventory quantity, inventory unit cost and inventory total cost
For June 19, it asks for quantity sold, cost of merchandise sold unit cost, cost of merchandise sold total cost, inventory quantity, inventory unit cost, inventory total cost; then spaces under the quantity sold, cost of merchandise sold unit cost, cost of merchandise sold total cost
For June 25, it asks for quantity sold, cost of merchandise sold unit cost, cost of merchandise sold total cost, inventory quantity, inventory unit cost, inventory total cost
For June 30, it asks for quantity purchased, purchases unit cost, purchases total cost, inventory quantity, inventory unit cost inventory total cost
June 30 balances for cost of merchandise sold total cost and inventory total cost
b. Based upon the preceding data, would you expect the inventory to be higher or lower using the last-in, first-out method?
QUESTION6.Use of automatic reordering system is appropriate for which type of buying situation?
a) Modified rebuy;
b) New task buying;
c) Straight rebuy;
d) Indirect rebuy.
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