Find what are the consequences for grace company ltd

Assignment Help Accounting Basics
Reference no: EM132708814

Grace Company Ltd uses the weighted average-cost method for inventory costing under periodic system. The company is having a very good year. In an effort to reduce income in the current year, the accountant took the unusual step of recommending to the purchasing department to make a large purchase of inventory at year-end. The price of the item to be purchased has nearly tripled during the year, and the item represents a major portion of inventory value.

Required:

For inventory management

Problem (a) If the accountant recommends the purchase, what are the consequences?

Problem (b) If Grace Company was using the FIFO method of inventory costing, what are the consequences?

Reference no: EM132708814

Questions Cloud

Analyze the ethics of allowing facilitating payments : Analyze the ethics of allowing facilitating payments such as under the FCPA in the U.S. and prohibiting them as under the U.K. Bribery Act.
Operations and flows of data : Operations and flows of data and then explore the benefits and challenges that an automated system may present in regard to effectiveness
Compute dow earnings per share for the year : Compute Dow's earnings per share for the year ended December 31, 2021.(Do not round intermediate calculations. Enter your answers in thousands.)
Compute stanley basic and diluted earnings per share : Compute Stanley's basic and diluted earnings per share for the year ended December 31, 2021. (Enter your answers in thousands.)
Find what are the consequences for grace company ltd : The price of the item to be purchased has nearly tripled, If Grace Company was using the FIFO method of inventory costing, what are the consequences?
Distribution and marketing plan : Distribution and Marketing Plan - How do you get the consumer to your site or social media? This is the exciting part of the promotion process
Prepared all required journal entries and post : Prepared all required journal entries and post. Reconcile the Accounts receivable control account to the Accounts receivable subsidiary ledger.
How much cash did the partners set aside for liquidation : In the first month of liquidation, certain assets were sold for P192,000. How much cash did the partners set aside for future liquidation expenses
Which the name given to the test of control : Which the name given to the test of control where the auditor reprocesses actual entity data using auditor-controlled software is

Reviews

Write a Review

Accounting Basics Questions & Answers

  Describe the benefits to the consumer of b2c sales

Describe the benefits to the consumer of B2C sales.

  What is terminal value of the stock

If Koman has a required rate of return of 0.19, what is terminal value of stock or what is the value of the stock when it first becomes a constant growth stock

  Calculate the dollar amount of each type of service

Rapid Auto has over 200 auto-maintenance service outlets nationwide. It provides primarily two lines of service: oil changes and brake repair.

  How normative approach is applicable for mia

Discuss how accounting history is important for the development of Malaysian accounting practices based on the above information.

  Re-figuring the depletion rate for year

Change in estimated amount of ore to be mined from year one to year 2. year 1 is 400000 and year 2 is 487500 tons. mined 50000tons in first year and mined 80,000 tons second year of which 60000 tons sold residual or salvage value of the land is $1..

  Rachel ray recently opened her own basket weaving studio

rachel ray recently opened her own basket weaving studio. she sells finished baskets in addition to the raw materials

  How much were cash dividends

Net income for the period was $59,000 and stock dividends were$3,000. How much were cash dividends

  Product cost abc company believes that it has an additional

product cost abc company believes that it has an additional 5000 machine hours available in the current facility before

  Analyze the role of religion and its influence on the state

Analyze the role of religion and its influence on the state in one of the following modern (within the past 20 years) countries: Iran, Iraq, USA

  Calculate the percent change in operating income expected

The degree of operating leverage is 1.5. Now Head-First expects to increase sales by 10% next year. Calculate the percent change in operating income expected

  Prepare a production budget for supermix

Prepare a production budget for Supermix for the months July, August, September, and October. All amounts as positive values

  Regression line predicting sales

The bookstore in Exercise 5 decides to have a gala event in an attempt to drum up business. They hire 100 employees for the day and bring in a total of $42,000. a) Find the regression line predicting Sales from Number of people working with the ..

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