24. A firm uses the dollar value LIFO retail method and has $ 2,000 in beginning inventory at retail at the beginning of the current year. The base year equivalent of this amount is $ 1,600. The base year index is 1.00. The beginning inventory reported in the Balance Sheet is $ 800. During the current year, the firm purchased $ 12,000 of inventory at cost and marked that up to $ 40,000. Sales for the year were $ 28,000. The relevant ending price index is 1.60. What amount does this firm report as inventory in its Balance Sheet at the end of the current year? ================================================= ACC 422 Week 2 DQ 1
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================================================= ACC 422 Week 2 DQ 2
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spent an additional $ 10,000 testing and preparing the machine for use. What amount should Merry record as the cost of the machine?
23. How does the retail inventory method establish the lower-of-costor-market valuation for ending inventory?
24. A firm uses the dollar value LIFO retail method and has $ 2,000 in beginning inventory at retail at the beginning of the current year. The base year equivalent of this amount is $ 1,600. The base year index is 1.00. The beginning inventory reported in the Balance Sheet is $ 800. During the current year, the firm purchased $ 12,000 of inventory at cost and marked that up to $ 40,000. Sales for the year were $ 28,000. The relevant ending price index is 1.60. What amount does this firm report as inventory in its Balance Sheet at the end of the current year? ================================================= ACC 422 Week 2 DQ 1
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Week 2 – DQ 1 Under what circumstances would a company need to estimate its inventory? What are the differences between using the gross profit method and retail inventory method for estimating inventory? Which method of estimation, gross profit or retail inventory, is best? Explain your answer.
================================================= ACC 422 Week 2 DQ 2
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Week 2 – DQ 2 What are the criteria for capitalization of fixed assets?