1. The operating cycle of a merchandising company covers the period from investing cash for purchasing merchandise and ends with the collection of cash by selling the merchandise.
Therefore, the typical operating cycle of a merchandising company = Inventory Conversion Period + Average Collection Period.
2. In the books of Home Furniture Ltd. :
Date | Account Titles | Debit | Credit |
$ | $ | ||
Jan 5 | Inventory | 46,560 | |
Accounts Payable | 46,560 | ||
To record purchase of inventory on credit | |||
Jan 12 | Accounts Receivable | 82,500 | |
Sales | 82,500 | ||
To record sales on credit | |||
Jan 12 | Cost of Goods Sold | 30,800 | |
Inventory | 30,800 | ||
To record cost of goods sold |
3. Balance in Inventory Control Account at the close of business on Jan 12 = $ 250,000 + $ 46,560 - $ 30,800 = $ 265,760.
Problem 1 (25 points) Home Furniture Ltd. sells washing machines. At December 31. 2018, Home Furniture L amounted to $250,000. During the first week of January 2018, the company made only o n...
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Can someone assist me with this please? Thanks! Inventory to Market Value.) L06-1, LO6-2, L06-3, L06-4. L06-5, L06-6, L06-7, L06-8 PROBLEM 6.8A A Comprehensive Problem CPI sells computer peripherals. At December 31, year 1. CPI's inventory amounted to $500,000 During the first week in January, year 2, the company made only one purchase and one sale. These transactions were as follows. Jan.2 Jan. 6 Purchased 20 modems and printers from Sharp. The total cost of these machines was $25,000 terms...
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solve problem 3 complete Lact-n, frt-cus Ising the cest iqures computed soove, rewer the lolowing quesions 2. Prepare the necessary journal enbies in ganeral jcurral fom) to adjuest the accouning Lincoin Company as of March 31, (Explanations may te amtled: a. Which of the ree cost fow income tor the current year? Would tis awen be the case Exisin (5 points asaumpñons wil result in the company reperting the lowest et income for the current year? Would tis he smount...