Name: DE VERA, KYLE C.

Crs. Yr.&Sec.: BSA-3A

AP1 ASSIGNMENT 3: INVENTORIES

Problem 1
Q1-1. What is the proper balance in the Allowance for Inventory Writedown at
December 31, 2018?
Lower of
Cost NRV Cost or NRV
Guitars 89,000 87,000 87,000
Xylophones 94,000 85,000 85,000
Trumpets 125,000 111,000 111,000
Violins 194,000 197,000 194,000
Total 502,000 480,000 477,000

Required allowance for inventory writedown

on December 31, 2018 (P502,000-P477,000) 25,000 D

Q2-2. The adjusting entry on December 31, 2018, to arrive at the proper allowanc
balance should be

Required Allowance 25,000

Less: Allowance balance 32,000
Decrease in Allowance (7,000)

Allowance for inventory writedown 7,000

Gain on inventory recovery

Problem 2
Finished Work in Raw
Goods Process Materials
Down tube shifters at NRV 798,000
Bar end shifters at cost 546,000
Head tube shifters at cost 585,000
Work in process at NRV 326,100
Derailleurs at NRV 330,000
Remaining items at NRV 382,000
Suppliers at cost
Totals 1,929,000 326,100 712,000

Q2-1.
Finished goods inventory 1,929,000 1.) B
Q2-2.
Work in process inventory 326,100 2.) C.
Q2-3.
Raw materials inventory 712,000 3.) D.
Q2-4.
Factory supplies 194,400 4.) A.
for Inventory Writedown at

o arrive at the proper allowance

7,000 A

Factory
Supplies

194,400
194,400