Determine the value of ending inventory

Assignment Help Accounting Basics

Reference no: EM131828223

Question: Pitt Limited is trying to determine the value of its ending inventory as of February 28, 2017, the company's year-end. The accountant counted everything that was in the warehouse as of February 28, which resulted in an ending inventory valuation of $48,000. However, she didn't know how to treat the following transactions so she didn't record them.

(a) On February 26, Pitt shipped to a customer goods costing $800. The goods were shipped FOB shipping point, and the receiving report indicates that the customer received the goods on March 2.

(b) On February 26, Martine Inc. shipped goods to Pitt FOB destination. The invoice price was $350 plus $25 for freight. The receiving report indicates that the goods were received by Pitt on March 2.

(c) Pitt had $500 of inventory at a customer's warehouse "on approval." The customer was going to let Pitt know whether it wanted the merchandise by the end of the week, March 4.

(d) Pitt also had $400 of inventory at a Belle craft shop, on consignment from Pitt.

(e) On February 26, Pitt ordered goods costing $750. The goods were shipped FOB shipping point on February 27. Pitt received the goods on March 1.

(f) On February 28, Pitt packaged goods and had them ready for shipping to a customer FOB destination. The invoice price was $350 plus $25 for freight; the cost of the items was $280. The receiving report indicates that the goods were received by the customer on March 2.

(g) Pitt had damaged goods set aside in the warehouse because they are no longer saleable. These goods originally cost $400 and, originally, Pitt expected to sell these items for $600.

Instructions: For each of the above transactions, specify whether the item in question should be included in ending inventory, and if so, at what amount. For each item that is not included in ending inventory, indicate who owns it and what account, if any, it should have been recorded in.

Reference no: EM131828223

Questions Cloud

How should restricted cash fund be reported on balance sheet : What was Apple's balance in cash and cash equivalents at December 31, 2014? Did it report any restricted cash? How did Apple define cash equivalents?

What is the relationship between a subnetwork and a node : What is the relationship between a subnetwork and a node? What kind of applications might use a desktop computer to Internet network?

What is the definition of data communications : What is the definition of a computer network, data communications, telecommunications, a local area network and a personal area network?

Identify the activities that pertain to a petty cash fund : Identify the three activities that pertain to a petty cash fund, and indicate an internal control principle that is applicable to each activity.

Determine the value of ending inventory : Pitt Limited is trying to determine the value of its ending inventory as of February 28, 2017, the company's year-end.

Which media type offers the lowest cost : Which media type offers the lowest cost? Which offers the best performance? Which offers the longest life? Which would you choose and why?

How might improve verbal and writing skills : For this Discussion, consider how using annotated bibliographies might improve verbal and writing skills.

Which of the current tape formats provides highest capacity : Which of the current tape formats provides highest capacity at lowest cost? Which is most reliable? Which is least likely to become obsolete 5 years from now?

Determine the nature of holographic storage : IBM has invested heavily in research and development for holographic storage systems. Investigate this research to determine the nature of holographic storage.

User Account

All Pages