Name: DE VERA, KYLE C

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

QUIZ 2: INVENTORY
PROBLEM 1
Q1 The gross profit ratio for eleven months ended May 31, 2006 is

Beginning inventory 140,000

Purchases – adjusted (1080000+12000-4000) 1,088,000
Total Goods accumulated for sale 1,228,000
Less: Ending inventory 220,000
Cost of goods sold 1,008,000

Sales 1,344,000
Cost of Sales 1,008,000
Gross Profit 336,000
GP% 0.25 B

Q2 The cost of goods sold during the month of June, 23003 using the gross profit ratio method is

Sales for the fiscal year ended June 30, 2006 1,536,000
Sales for the eleven months ended May 31, 2006 1,344,000
Sales for the month of June 30, 2006 192,000
Less: Sales of goods at cost 16,000
Sales with gross profit 176,000
Multiply: 1-gp rate 0.75
Total 132,000
Plus: Sale of goods at cost 16,000
Total Cost of Goods Sold for June 2006 148,000 B

Q3 The June 30, 2006 inventory using the gross profit method is

Ending Inventory 220,000

Purchases for the month of June(1280000-1080000) 200,000
Goods sold at cost (16,000)
Total 404,000
Less: Cost of items sold in June (192000*.75) 144,000
Gross Profit 260,000 A

PROBLEM 2
Q4 The Sales for December is over/(under) by:
Sales: Amount
Unadjusted Sales 20,000,000
Invoice 300 (50,000)
Invoice 304 (56,000)
 invoice 307 74,500
Invoice 310 67,500
Adjusted Sales 20,036,000

Unadjusted Sales 20,000,000

Adjusted Sales 20,036,000
Difference (36,000) A

Q5 The Inventory for December is over/(under) by:

Inventory: Amount
Unadjusted Inventory 1,400,000
Invoice 301 (50,000)
Invoice 305 (72,000)
invoice 307 (59,600)
Adjusted Inventory 1,218,400

Unadjusted Inventory 1,400,000

Adjusted Inventory 1,218,400
Difference 181,600 B

Q6 The adjusted inventory at December 31, 2006 is:

Refer to Q5:
Adjusted Inventory 1,218,400

Q7 The adjusted sales at December 31, 2006 is:

Refer to Q4:
Adjusted Sales 20,036,000

Q8 How much sales for the month of December 2006 were erroneously recorded in January 2007?

Invoice # 307 74,500

Invoice # 310 67,500
Total 142,000 D

Q9 How much sales for the month of January 2007 were erroneously recorded in December 2006?

Invoice # 300 50,000

Invoice # 304 56,000
Total 106,000 D

PROBLEM 3
Adjustments:
1 Ar 77,500
Cash (77500*95%) 73,625
 Sales Discount (77500*5%) 3,875
Sales 90,025
Cash 90,025

2 Cash 90,000
Purchase Discount 3,100
AP 93,100

3a Inventory 68,750
Cost of Sales 68,750

3b Inventory 54,375
Cost of Sales 54,375
Purchases 54,375
AP 54,375

3c Cost of Sales 159,375

Inventory 159,375

3d Inventory 32,500
Cost of Sales 32,500

3e AP 43,750
Purchases 43,750

Q10 Cash 240,800

Adjustments:
1 (73,625)
1 (90,025)
2 90,000
Adjusted Cash 167,150 D

Q11 Accounts Receivable 563,500

Adjustments:
1 77,500
Adjusted A/R 641,000 B

Q12 Merchandize inventory 1,512,500

Adjustments:
3a 68,750
3b 54,375
3c (159,375)
3d 32,500
Adjusted Inventory 1,508,750 B
Q13 Accounts Payable 1,050,250
Adjustments:
2 93,100
3b 54,375
3e (43,750)
Adjusted A/P 1,153,975 B

Q14 Working Capital

Cash 167,150
AR 641,000
Inventory 1,508,750
Total Assets: 2,316,900
less: AP 1,153,975
Expenses 107,750
Working Capital 1,055,175 C

Q15 Current Ratio

Total Assets: (refer to Q14) 2,316,900
Divide by:
Accounts Payable 1,153,975
Expenses 107,750 1,261,725
Curent Ratio 1.84 C
ratio method is
d in January 2007?

n December 2006?