Unadjusted balances

b.
c.
d.
e.
f.
g.
h.
i
j
Adjsuted balances

PAJE:
Accounts payable
Inventory

200,000 x 60% = 120,000

Inventory
Cost of sales

126,000 / 60% = 210,000

Sales
Accounts receivable

175,000 x 60% = 105,000

Cost of sales
Inventory

320,000 x 60% = 192,000

Inventory
Cost of sales

Inventory
Sales return (72,000 /60%)
Cost of sales
Accounts receivable

Inventory (90,000 x 60%)

Cost of sales

Inventory
Accounts payable

Inventory
Accounts payable
Inventory Net Sales AP
3,180,000 15,600,000 2,620,000
(50,000) - (50,000)
120,000 - -
- (210,000) -
(105,000) - -
192,000 - -
72,000 (120,000) -
54,000 - -
135,000 - 135,000
115,000 - 115,000
3,713,000 15,270,000 2,820,000

50,000
50,000

120,000
120,000

210,000
210,000
105,000
105,000

192,000
192,000

72,000
120,000
72,000
120,000

54,000
54,000

135,000
135,000

115,000
115,000
Beginning inventory

Sale
Purchase
Sale
Purchase
Purchase return
Sale
Purchase
Sales return
Ending inventory

First-in, First-out (FiFo):

610

TOTAL COST - FIFO

Beginning inventory
Net purchases:
200 x 770 =
350 x 780 =
50 x 790 =
TGAS
TGAS
Ending inventory (FiFo)
Cost of sales

Net sales:
300 x1200 =
150 x 1350 =
100 x 1250 =
(10) x 1250 =
Net sales

Net sales
Cost of sales (FiFo)
Gross profit
UNITS AMOUNTS
500 375,000
50 38,000
550 413,000
(300)
250
(150)
350
(50)
(100)
50
10
610

50 790 39,500
350 780 273,000
200 770 154,000
10 760 7,600
474,100
(1)
413,000

154,000
273,000
39,500 466,500
879,500
 879,500
(474,100)
405,400 (2)

360,000
202,500
125,000
(12,500)
675,000

675,000
(405,400)
269,600
 PURCHASES
UNITS UC
Beginning balances
Sale
Purchsed 250 770.00
Sale
Purchsed 350 780.00
Purchaed return (50) 770.00
Sale
Purchase 50 790.00

TGAS
Ending inventory (WA)
Cost of sales (WA)

Net sales
Cost of sales (FiFo)
Gross profit

EI COS
FiFo 474,100 405,400
WA (Moving) 470,837 408,663
ASES SALES BALANCE
TC UNITS UC TC UNITS
550
300 750.91 225,273 250
192,500 500
150 760.45 114,068 350
273,000 700
(38,500) 650
100 770.24 77,024 550
39,500 600
(10) 770.24 (7,702) 610
466,500 408,663

879,500
(470,837)
408,663 (2)

675,000
(408,663)
266,337

GP
269,600
266,337
BALANCE
UC TC
750.91 413,000
750.91 187,727
760.45 380,227
760.45 266,159
770.23 539,159
770.24 500,659
770.24 423,635
771.89 463,135
771.86 470,837
(1)
 UNITS
D E
Beginning Inventory 50,000 30,000
Net purchases 110,000 75,000
TGAS 160,000 105,000
Sales (105,000) (50,000)
Ending Inventory 55,000 55,000

Computations of EI using FiFo:

40,000 7
55,000 units (Product D) 15,000 6.50
TOTAL

55,000 units (Product E) 30,000 11

25,000 10.50
TOTAL

10,000 1.70
55,000 units (Product F) 30,000 1.50
15,000 1.00
TOTAL

Product D 377,500
Product E 592,500
Product F 77,000
TOTAL cost of EI (FiFo) 1,047,000 (1)
Computations of NRV:
Product D (P8 x 90% x 90% x 55,000)

Product E (P10 x 90% x 90% x 55,000)

Product F (P2 x 90% x 90% x 55,000)

Lower of cost and NRV (LCNRV):

Product D 356,400
Product E 445,500
Product F 77,000
TOTAL LCNRV 878,900 (5)

TOTAL COST 1,047,000 Allowance

TOTAL LCNRV 878,900
Allowance, end 168,100

Testing for write down (Beg balance)

Product D (P8 x 90% x 50,000)

Product E (P10 x 90% x 30,000)

Product F (P2 x 90% x 55,000)

TOTAL NRV of Beg. Inventory

LCNRV of Beginning inventory

Product D
Product E
Product F
TOTAL LCNRV of BI

Total cost (300,000 + 300,000 + 55,000)

TOTAL LCNRV of BI
Allowance, beginning
TS
F
55,000
40,000
95,000
(40,000)
55,000

280,000
97,500
377,500

330,000
262,500
592,500

17,000
45,000
15,000
77,000
 356,400

445,500

89,100

Allowance
30,000 Beginning Inventory
138,100 (3) Net purchases
168,100 TGAS
(2) Ending inventory
Cost of sales
360,000

270,000

99,000

729,000
300,000
270,000
55,000
625,000

655,000
625,000
30,000
DIRECT ALLOWANCE
625,000 655,000
1,599,500 1,599,500
2,224,500 2,254,500
(878,900) (1,047,000)
1,345,600 1,207,500
(4)
138,100
 Inventory 11/30
Balances 1,400,000
a. 120,500
b. -
c. -
d. -
e. -
Adjusted 1,520,500
(1)

Beginning inventory 1/1

Purchases 11/30
TGAS 11/30
Inventory 11/30
Cost of sales 11/30
Sales 11/30
Cost ratio

GP rate = 100% - 79% = 21%

Beginning inventory 1/1

Purchases as of 12/31
TGAS as of 12/31
Cost of sales as of 12/31:
Sales as of 12/31
Sales without GP
Sales with GP
Cost ratio
Cost of sales with GP
Cost of sales without GP
Total cost of sales
Ending inventory as of 12/31

Cost of sales as of 12/31

Cost of sales as of 11/30
COST for December

Sales as of 12.31
Sales as of 11/30
Sales for month of Dec
Sales without GP
Sales with GP
Cost ratio
Cost sales with G\P
Cost sales without G\P
Cost of sales for December
Purchases 11/30 Purchases 12/31 Sales 11/30
10,250,000 12,500,000 12,600,000
120,500 - -
(22,500) (30,000) -
(50,000) - -
(90,000) - -
- - -
10,208,000 12,470,000 12,600,000
(2)

1,266,500
10,208,000
11,474,500
(1,520,500)
9,954,000
12,600,000
79.00%

(3)

1,266,500
12,470,000
13,736,500

14,400,000
(200,000)
14,200,000
 79%
11,218,000
200,000
11,418,000 (4)
2,318,500 (6)

11,418,000
9,954,000
1,464,000 (5)

14,400,000
(12,600,000)
1,800,000
(200,000)
1,600,000
79%
1,264,000
200,000
1,464,000 (5)
Sales 12/31
14,400,000
-
-
-
-
-
14,400,000