Reference no: EM13903910
Costs of sales and inventory under alternative cost-?ow assumptions
Naiad distributes equipment for yachts and small boats. It decides to stock the EauK, a new type of desalinator that uses the boat's own motion through the sea to operate the device. The following table shows the company's purchases of EauK units in the second quarter of x4.
|
April
|
5
|
at A2,340 each
|
|
May
|
5
|
at A2,100
|
|
June
|
6
|
at A2,050
|
Naiad sells 12 EauK units in this quarter. It calculates the cost of sales on a periodic basis at the end of the quarter.
Required
(a) Compute the costs of second quarter sales and of units in inventory at end-June x4, under FIFO, WAC and LIFO cost-flow assumptions.
(b) Assume the company uses the WAC cost-flow assumption. A consultant urges Naiad to purchase additional units of the desalinator before the end of the second quarter. He argues that the extra purchases will reduce the risk of stock-outs in the busy third quarter and, in addition, will increase second quarter profits.
Recalculate WAC cost of sales in the second quarter, assuming the company buys an extra four units of EauK in late June at a unit price of A2,050 (making purchases of 10 units in the month). Why is cost of sales lower than under the WAC case in (a)? Is the company better off purchasing the additional four units at end-quarter 2?
|
Employee is exempt and they are absent a lot
: If a employee is Exempt and they are absent a lot, does the company have the right to deduct the days worth from the employees salary?
|
|
Great responses class
: Great responses class! There are many descriptions about how HIPAA or the Health Insurance Portability and Accountability Act affect business organizations. As a Human Resource Manager how would you explain this importance of this Act to new employee..
|
|
Are employers allowed to make exceptions to allow
: Are employers allowed to make exceptions to allow employees to enroll, change, or disenroll from their medical coverage without a qualified life event, if the plan is governed by ERISA?
|
|
Department store assistant manager
: Evaluate and explain as accurately as you can the manner in which each of the following individual or party would be affected by fairly rapid inflation? a) A department store assistant manager. b) A pensioner who receives fixed monthly income.
|
|
Compute the costs of second quarter sales
: Compute the costs of second quarter sales and of units in inventory at end-June x4, under FIFO, WAC and LIFO cost-flow assumptions.
|
|
Low-income american families
: Suppose that Chinese manufacturers develop the ability to build a good car that costs only $5,000. They start shipping it to the U.S. For each of the following groups, say whether they are likely to win, lose or not be affected much by the Chinese..
|
|
Find the total cost of roasting
: A coffee company has found that the marginal cost, in dollars per pound, of the coffee it roasts is represented by the function below, where x is the number of pounds of coffee roasted. Find the total cost of roasting 150 lb of coffee, disregardin..
|
|
Calculate the x six gross profit and end-x six inventory
: Calculate the x6 gross profit and end-x6 inventory for this product line under FIFO, LIFO and WAC cost-flow assumptions.
|
|
Prepare the bond schedule showing interest paid
: Ridgetop Company issued the following 5-year bonds on January 1, 2013: $100,000 maturity value, 6% annual interest payable semi-annually on July1 and December 31. The market rate of the date of issuance was 7%.
|