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Module 9 Assignment 1: |
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Whitewater Co. lost its entire inventory in a flash flood that occurred on August 31, 20##. |
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Over the past 4 years gross profit has averaged 32% of net sales. The following records for August were recovered: |
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Beginning Inventory |
$38,600 |
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Net Purchases |
$341,900 |
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Sales |
$530,400 |
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Sales returns and allownaces |
$12,300 |
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Sales discounts |
$6,500 |
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Requirements: |
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1 |
Estimate the August 31 inventory using the gross profit method. |
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2 |
Prepare the August income statement through gross profit for Whitewater Co. |
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Module 9 Assignment 2: |
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P.F. Johnson has the following information for the years ending December 31, 2009 and 2010. |
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2010 |
2009 |
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Sales Revenue |
$242 |
$239 |
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Cost of Goods Sold: |
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Beginning Inventory |
$22 |
$38 |
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Net Purchases |
152 |
144 |
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Goods Available for Sale |
$174 |
$182 |
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Ending Inventory |
13 |
22 |
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Cost of Goods Sold |
161 |
160 |
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Gross Profit |
$81 |
$79 |
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Operating Expenses |
55 |
54 |
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Net Income |
$26 |
$25 |
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Requirements: |
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1 |
Compute the inventory turnover rate for P.F. Johnson for 2009 and 2010. Round to two decimal places. |
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2 |
What is the likely cause of the change in turnover rate from 2009 to 2010? |
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