Estimate the valuation of the ending inventory

Assignment Help Financial Accounting
Reference no: EM132961051

The records of Diskount department stores Inc. provided the following data for 20X5:

Sales (gross) $800,000

Sales returns $2,000

Additional markups $9,000

Additional markup cancellations $5,000

Markdowns $7,000

Purchases:

At retail $850,000

At cost $459,000

Purchase returns:

At retail $4,000

At cost $2,200

Freight on purchases $7,000

Beginning inventory:

At retail $80,000

At cost $45,000

Markdown cancellations $3,000

Problem 1: Estimate the valuation of the ending inventory and cost of goods sold using the gross margin method. Last year's gross margin percentage was 51%.

Problem 2: Estimate the valuation of the ending inventory and cost of goods sold using the retail sales method, which approximates lower-of-cost-or-NRV valuation.

Problem 3: Which method is likely to be more accurate? Comment.

Reference no: EM132961051

Questions Cloud

Which statement correct regarding retirement living expense : Which statement is correct regarding retirement living expenses? Work-related expenses, such as driving back and forth to work, tend to higher during retirement
Project plan for implementation of hris : Create the project plan for implementation of HRIS and the mobile app for the company. Evaluate the project status reportCreate the project plan for implementat
Compute the amount to be presented as inventories : Compute the amount to be presented as inventories under current assets in the statement of financial position for the year
Selecting canadians affect and organization and society : Why is diversity and inclusion important when selecting and recruiting and how does the lack of diversity when selecting Canadians affect and organization and s
Estimate the valuation of the ending inventory : Estimate the valuation of the ending inventory and cost of goods sold using the gross margin method. Last year's gross margin percentage was 51%.
How much of money actually goes to buy shares : How much of her money actually goes to buy shares in the mutual fund? Racheal Ray puts $8,000 into a load mutual fund. She knows that her up-front sales
Calculating the Glasgow Coma Scale : What type of painful stimuli can be applied in calculating the Glasgow Coma Scale for both motor and eye-opening responses, and how should these be applied
What is estimated net taxable estate for tom cook : He still owes $175,000 on his mortgage. The probate and administration costs of his estate are estimated at $5,000. What is his estimated net taxable estate?
What aspect of investing interests dana : What aspect of investing interests Dana? Dana Smith has received a $12,000 gift from her mother and is trying to decide how to invest it.

Reviews

Write a Review

Financial Accounting Questions & Answers

  Discuss which factors determine the value of a call option

As an expert in pricing financial derivatives, your friend, John, Critically discuss which factors determine the value of a call option and how.

  Will the bonds issue price be greater or less

Will the bonds' issue price be greater than or less than the $750,000 if we assume that the market interest rate for similar bonds is 10% per year compounded

  Analyze home depots cash flow statements

Analyze Home Depots Cash Flow Statements. Is Home Depot funding its investments out of internal cash flow or from external financing? Are dividends financed out of internal cash flow or by external financing?

  Land value and the remaining portion to the minerals

At the beginning of 2017, Waterway Company acquired a mine for $1,676,600. Of this amount, $110,000 was ascribed to the land value and the remaining portion to the minerals in the mine. The total amount of depletion for 2017. The amount that is charg..

  Differences between the two sets of principles

There has been much written about the differences between the two sets of principles. There has also been much written as to whether IFRS should be adopted

  Income statement of anderson medical supply company

1.The 2013 income statement of Anderson Medical Supply Company reported net sales of $8 million, cost of goods sold of $4.8 million, and net income of $800,000.

  What amount should oak city report for property tax revenues

What amount should Oak City report for 2012 property tax revenues in the Statement of Revenues, Expenditures, and Changes in Fund Balances prepared for governmental funds?

  Determine the initial investment

A project with a profitability index of 1.156 also has net cash flows with a present value of $71672. Determine the initial investment

  How could this fraud have been prevented

May 13, 1988, a Friday incidentally, will be remembered by a major Chicago bank.- How could this fraud have been prevented?-  Why is this a difficult fraud to prevent?

  Journalize the share transactions

Oct 8 Issued 35,000 common shares in exchange for Building valued at $450,000. Journalize the share transactions during 2020

  Determine the amount of income that the partner report

Determine the amount of income that the partner should report as income from the partnership or the amount of capital gain or loss the partner should recognize.

  Find and calculate the asset turnover

Promised to pay the amount due after two years. Throughout the? year, it earned revenue of $56,000 every month. Calculate the asset turnover

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd