Question

Question 1

The following information pertains to the physical inventory of Electronics Unlimited taken at December 31:

		Per Unit
Product	Units on Hand	Cost			NRV
Audio equipment:
Wireless audio receivers	338	$	188		$	199
Touchscreen MP3 players	253		223			203
Audio mixers	319		177			193
Audio stands	197		103			85
Video equipment:
Televisions	473		298			253
5GB video cards	284		183			171
Satellite video recorders	205		618			647
Car equipment:
GPS navigators	178		145			171
Double-DIN Car Deck with iPod/iPhone Control and Aux Input	163		198			213

Required:
1. Calculate the LCNRV for the:

1. inventory by major group
2. inventory, applied separately to each product.

2. Prepare the appropriate entry, if any, for 1(a) and 1(b).

QUESTION 2

The records of Thomas Company as of December 31, 2020, show the following:

The accountant of Thomas Company discovers in the first week of January 2021 that the following errors were made by his staff.

1. Goods costing $4,610 were in transit (FOB shipping point) and were not included in the ending inventory. The invoice had been received and the purchase recorded.
2. Damaged goods (cost $4,155) that were being held for return to the supplier were included in inventory. The goods had been recorded as a purchase and the entry for the return of these goods had also been made.
3. Inventory items costing $3,966 were incorrectly excluded from the final inventory. These goods had not been recorded as a purchase and had not been paid for by the company.
4. Goods that were shipped FOB destination had not yet arrived and were not included in inventory. However, the invoice had arrived on December 30, 2020, and the purchase for $2,722 was recorded.
5. Goods that cost $2,444 were segregated and not included in inventory because a customer expressed an intention to buy the goods. The sale of the goods for $4,255 had been recorded in December 2020.

Required:

Using the format provided below, show the correct amount for net purchases, profit, accounts payable, and inventory for Thomas Company as at December 31, 2020. (Negative answers should be indicated by a minus sign. Do not leave any empty spaces; input a 0 wherever it is required.)

QUESTION 3

Telamark Company uses the moving weighted average method for inventory costing.

Required:
The following incomplete inventory sheet regarding Product W506 is available for the month of March 2020. Complete the inventory sheet. (Use the value of the ending inventory as your base number and adjust the COGS $ amount to the required amount to make the Total Goods Available for Sale to the total of the Value of the ending inventory and the COGS total. Negative value should be indicated with minus sign. Round your intermediate and final answers to 2 decimal places.)

Note: March 4 reflects a return made by a customer of incorrect items shipped on March 3; these items were returned to inventory.

Analysis Component:

The gross profit realized on the sale of Product W506 during February 2020 was 36.61%. The selling price was $158 during both February and March. Calculate the gross profit ratio for Product W506 for March 2020 and determine whether the change is favorable or unfavorable from February. (Round your intermediate calculations and final answer to 2 decimal places.)

Answer 1

1. (a) Inventory by Major Group :

		Per Unit		Total		LCNRV
Product	Units on Hand	Cost	NRV	Cost	NRV
Audio equipment:
Wireless audio receivers	338	188	199	63544	67262
Touchscreen MP3 players	253	223	203	56419	51359
Audio mixers	319	177	193	56463	61567
Audio stands	197	103	85	20291	16745
Total				196717	196933	196717
Video equipment:
Televisions	473	298	253	140954	119669
5GB video cards	284	183	171	51972	48564
Satellite video recorders	205	618	647	126690	132635
Total				319616	300868	300868
Car equipment:
GPS navigators	178	145	171	25810	30438
Double-DIN Car Deck with iPod/iPhone Control and Aux Input	163	198	213	32274	34719
Total				58084	65157	58084
Total LCNRV of Inventory						5,55,669

1 (b) Inventory applied separately to each product :

		Per Unit		Total		LCNRV
Product	Units on Hand	Cost	NRV	Cost	NRV
Audio equipment:
Wireless audio receivers	338	188	199	63544	67262	63544
Touchscreen MP3 players	253	223	203	56419	51359	51359
Audio mixers	319	177	193	56463	61567	56463
Audio stands	197	103	85	20291	16745	16745
Total						188111
Video equipment:
Televisions	473	298	253	140954	119669	119669
5GB video cards	284	183	171	51972	48564	48564
Satellite video recorders	205	618	647	126690	132635	126690
Total						294923
Car equipment:
GPS navigators	178	145	171	25810	30438	25810
Double-DIN Car Deck with iPod/iPhone Control and Aux Input	163	198	213	32274	34719	32274
Total						58084
Total LCNRV of Inventory						5,41,118

Q-2 Format required is not provided. So not able to solve.

Q-3 Incomplete Inventory sheet mentioned is not provided. So not able to solve.