Abel Company must write down its inventory by $30,000 to the net realizable value of $450,000 at December 31, 2022. What is the effect of this write-down on the year 2022 financial statements?
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Akash M.
Harlequin Co. adopted the dollar-value LIFO retail method at the beginning of 2021 (its base year). Its beginning inventory for 2021 was $36,000 at cost and $72,000 at retail prices. At the end of 2021, it computed its estimated ending inventory at retail to be $110,000. Assuming its cost-to-retail percentage for 2021 transactions was 60%, and that the retail price index at the end of 2021 was 1.10, what is the inventory balance that Harlequin Co. would report in its 12/31/2021 balance sheet?
Oluwadamilola A.
Old Rose Company's pricing structure has been established to yield a gross margin of 30%. The following data pertain to the year ended December 31, 2019: Sales - P2,000,000 Inventory, January 1 2019 - 1,000,000 Purchases - P800,000 Freight cost on purchases - P20,000 Freight cost on merchandise sold - P30,000 Inventory inside the company's warehouse, per actual account on December 31, 2019 - P160,000 Credit Memo issued to customers for goods returned and received - P50,000 Credit memos issued to customers for merchandise to be returned, January 2, 2020 - P40,000 Sales Discount - P100,000 Old Rose Company is satisfied that all sales and purchases have been fully and properly recorded. REQUIRED: How much would Old Rose Company reasonably estimate as a shortage in inventory at December 31, 2019?
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