Questions -
Q1. Kim Co. purchased goods with a list price of $186,000, subject to trade discounts of 30% and 20%, with no cash discounts allowable. How much should Kim Co. record as the cost of these goods?
Q2. Keillor Company's inventory of $1,128,600 at December 31, 2012, was based on a physical count of goods priced at cost and before any year-end adjustments relating to the following items.
(a) Goods shipped from a vendor f.o.b. shipping point on December 24, 2012, at an invoice cost of $70,350 to Keillor Company were received on January 4, 2013.
(b) The physical count included $30,810 of goods billed to Sakic Corp. f.o.b. shipping point on December 31, 2012. The carrier picked up these goods on January 3, 2013.
What amount should Keillor report as inventory on its balance sheet?
Q3. Zimmerman Corp. had 2,050 units of part M.O. on hand May 1, 2012, costing $23 each. Purchases of part M.O. during May were as follows.
Units Units Cost
May 9 2,550 $25
May 17 4,050 $26
May 26 1,550 $27
A physical count on May 31, 2012, shows 2,550 units of part M.O. on hand. Using the FIFO method, what is the cost of part M.O. inventory at May 31, 2012? Using the LIFO method, what is the inventory cost? Using the average cost method, what is the inventory cost? (Round answers to 0 decimal places, e.g. 1,620.)
Q4. Ashbrook Company adopted the dollar-value LIFO method on January 1, 2012 (using internal price indexes and multiple pools). The following data are available for inventory pool A for the 2 years following adoption of LIFO.
Inventory
At Base-Year
Cost
At Current-Year
Cost
1/1/12 $207,000 $207,000
12/31/12 242,000 266,200
12/31/13 265,000 299,450
Computing an internal price index and using the dollar-value LIFO method, at what amount should the inventory be reported at December 31, 2013?
Q5. Donovan Inc., a retail store chain, had the following information in its general ledger for the year 2013.
Merchandise purchased for resale $911,580
Interest on notes payable to vendors 9,130
Purchase returns 16,740
Freight-in 24,080
Freight-out 17,940
Cash discounts on purchases 7,290
What is Donovan's inventoriable cost for 2013?