Estimating Inventories

Exercises 3-1
Sales
Cost of Sales
Inventory , beg 200,000
Purchases 100,000
Purchase Return 6,000
Freight 4,000
COGAS 298,000
Inventory, end 74,000
COS
GP

74,000
10% 20,000
8,000
Lost by flood 46,000

EXERCises 3-2 2020 2021

Net sales 3,860,000 100% TGAS
COS 3,049,400 79% Invty, beg
GP 810600 21%

COGAS 4,069,400
Inventory , end 1,020,200
Cos 3,049,400
 320,000 2020
Sales 800,000 100%
COS 560,000 70%
GP 240,000 30%

224,000 70%
30%

4,157,000 NS 4,080,000
1,020,200 COS 3,100,800
GP 979,200

TGAS 4,157,000
COS 3,100,800
Invty, end 1,056, 200
Less:
Undamaged
120,000 * .76 91,200
estimated
NRV 18,000
947,000 Inventory fire loss
EXERCISES 3-5 FIFO
COST RETAIL
Beginning Invty. 1,300,000 2,600,000 Net Purchases
Purchases 18,000,000 29,200,000 Departmental transfer in
Freight- in 400,000 Net mark up
Purchase Return -600,000 -1,000,000 Mark downs
Purchase Allowances -300,000 Cost ratio 65%
Departmental transfer 400,000 600,000 Beginning Inventory
Net mark up 600,000 GAS
GAS Conservative 19,200,000 32,000,000 Less: Net Sales
Cost ratio 60% Ending Inventory @ retail
Mark downs 2,000,000
GAS Average 19,200,000 30,000,000 FIFO cost 5,000,000 X .65
Cost ratio 64%
Less: Sales 24,700,000
Sales Return -350,000
Employee Discounts 600,000
Loss from breakage 50,000 25,000,000
Ending Inventory at retail 5,000,000

Conservative cost or conventional

5,000,000 60% 3,000,000
Average 5,000,000 64% 3,200,000
 Cost Retail
Net Purchases 17,500,000 28,200,000
Departmental transfer in 400,000 600,000
Net mark up 600,000
Mark downs 2,000,000
Cost ratio 65% 17,900,000 27,400,000
Beginning Inventory 1,300,000 2,600,000
19,200,000 30,000,000
Less: Net Sales 25,000,000
Ending Inventory @ retail 5,000,000

FIFO cost 5,000,000 X .65 3,250,000

E-3-6
Cost Retail FIFO Cost Retail
440 800 4,360 6,700
4,500 7,400 ratio 65%
-240 -350 440 800
100 4,800 7,500
250 6,900
-100 600
GAS - Conservative 4,800 8,000 600X65% 390
Cost ratio 60%
-600
100
GAS - Average 4,800 7,500
Cost Ratio 64%
6,500
100
200
100 6,900
Ending Invty at retail 600

Conventional 600 X 60% 360

Ave 600X64% 384
FIFO
MCP 3-1
6,000 S 100% 30,000
20,000 COS 70% 21,000
GAS 26,000 GP 30%
Invty.end 4,500
21,500
21,000
500 Missing Invty.

MCP3-2
51,600 NS 574,400
360,600 COST 344,640
GAS 412,200

412,200 5,800 406,400

344,640
Invty. End 61,760
-2,000
-2,940
56,820

MCP-3-3
55,000 S 105,000
46,000 COS 84,000
GAS 101,000 GP 21,000
84,000
17,000
6,000
Invty. Loss 11,000
MCP 3-5
Accounts Receivable Sales
Dr CR CR S
175,000 2,115,000 225,000 COS
2,205,000 2,205,000
265,000 2,430,000

MCP 3-6 400,000 1,200,000 MCP 3-7

15,000 COST 780,000
90,000 420,000
505,000
420,000
85,000
5,000
80,000 Cost ratio

Average

MCP 3-8 Cost Retail MCP 3-9

440 800
4,500 7,400
-240 -350
100
250
-100
GAS 4,800 8,000
Cost ratio 60%
-600
100
GAS - Average 4,800 7,500
Cost ratio 64%
5,300
-400
200
100 5,200
Ending Invty 2,300

Convention 2,300 * .60 1,380

Ave 2,300* .64 1,472
 2,205,000 375,000
1,652,400 68% 1,385,000
1,760,000
1,652,400
107,600
Salvaged Invty 5,000
Invty. Loss - typhoon 102,600

Cost Retail
2,000 3,000 Sales 13,000
10,600 14,000 Cost 9,100 70%
1,600
18,600
600
12,600 18,000
70%
12,000
400
600
13,000
5,000
5,000 * .70 3,500

Cost Retail MCP 3-10 Cost Retail

80 140 160 400
297 420 2,800 3,200
4 40
10 300
-2 -30
GAS 301 428 -160
Cost ratio 40
70% GAS 3,000 3,750
GAS 381 568 Cost ratio
400 80%
8 408 3,000
Ending Invty 160 120 3,120
Ending Invty. 630
FIFO 160 * .70 112,000
630,000
Per Count 500,000
Shortage 130,000
*.80
104,000