2012, under each of the following inventory methods. Assume
Esplanade Company uses the periodic inventory method.
Question 7
Floyd Corporation has the following four items in its ending
inventory. Determine the final lower of cost or market inventory value
for each item.
Question 8
Kumar Inc. uses a perpetual inventory system. At January 1, 2013,
inventory was $320,786 at both cost and market value. At December
31, 2013, the inventory was $428,714 at cost and $403,231 at market
value. Prepare the necessary December 31 entry under:
Question 9
Boyne Inc. had beginning inventory of $15,000 at cost and $25,000 at
retail. Net purchases were $150,000 at cost and $212,500 at retail. Net
markups were $12,500; net markdowns were $8,750; and sales were
$196,250. Compute ending inventory at cost using the conventional
retail method.
Question 10
(Gross Profit Method)
Astaire Company uses the gross profit method to estimate inventory
for monthly reporting purposes. Presented below is information for
the month of May.
Question 11
Previn Brothers Inc. purchased land at a price of $30,400. Closing
costs were $1,820. An old building was removed at a cost of $14,850.
What amount should be recorded as the cost of the land?
Question 12
Garcia Corporation purchased a truck by issuing an $108,000, 4-year,
zero-interest-bearing note to Equinox Inc. The market rate of interest
for obligations of this nature is 10%. Prepare the journal entry to
record the purchase of this truck.