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zzz [600]
3 years ago
9

Northwest Fur Co. started the year with $96,000 of merchandise inventory on hand. During the year, $430,000 in merchandise was p

urchased on account with credit terms of 1/15, n/45. All discounts were taken. Northwest paid freight-in charges of $7,000. Merchandise with an invoice amount of $4,100 was returned for credit. Cost of goods sold for the year was $373,000. What is ending inventory?
Business
1 answer:
fredd [130]3 years ago
3 0

Answer:

The a answer is $151,642

Explanation:

Cost of sales = opening/starting inventory plus purchases minus closing/ending inventory.

Therefore, closing/ending inventory = opening/starting inventory plus purchases minus cost of sales.

Opening inventory is $96,000

To determine purchases, we will factor in freight-in fee, merchandise return, discount received.

So purchase is:

Purchase on credit--------$430,000

Freight-in-----------------------$7,000

Merchandise return--------($4,100)

Discount received ([$430,000 - $4,100]x 1%)--------------------($4,259)

Purchase =$428,641

Cost of goods sold is $373,000

Therefore, ending or closing inventory is:

$96,000 + $428,641 - $373,000

=$151,642

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Here are the 2018 and 2019 (incomplete) balance sheets for Newble Oil Corp.BALANCE SHEET AT END OF YEAR(Figures in $ millions)As
otez555 [7]

Answer:

Newble Oil Corp Balance Sheet for 2018:

Current Assets - $319 million

Net Fixed Assets - $1,290 million

Total Assets = $1,609 million

Current Liabilities - $255 million

Long-term Debts - $875 million

Total Liabilities = $1,130 million

a) Equity = Total Assets ($1,609 million) minus Total Liabilities ($1,130 million) = $479 million

Newble Oil Corp Balance Sheet for 2019:

Current Assets - $465 million

Net Fixed Assets - $1,465 million

Total Assets = $1,930 million

Current Liabilities - $249million

Long-term Debts - $1,010 million

Total Liabilities = $1,259 million

b) Equity = Total Assets ($1,930 million) minus Total Liabilities ($1,259 million) = $671 million

c) Net Income during 2019, if Newble paid dividends of $145 million:

2019 Equity plus Dividends paid minus 2018 Equity = Net Income

($671 + $145 - $479) million = $337 million

d) Depreciation charge for 2019 if Newble purchased $345 million in fixed assets:

2018 fixed assets plus new acquisition minus 2019 fixed assets =

$(1,290 + 345 - 1,465) million = $170 million

e) Change in net working capital between 2018 and 2019:

Net working capital = Current Assets minus Current Liabilities

2018 net working capital = $319 - $255 = $64 million

2019 net working capital = $465 - $249 = $216 million

Therefore, the change in net working capital is $216 - $64 = $152 million.

f) Debt paid off during the year:

2018 debt plus new issue minus 2019 debt balance equals debt paid off.

$(875 + 218 - 1,010) millions = $83 million

Explanation:

a) Equity is the difference between total assets and total liabilities.  In accounting equation, assets = liabilities + equity.

b) Dividends is a distribution from retained earnings (equity).  It decreases the retained net income, which increases the equity.

c) Depreciation also decreases the assets.  To find the charge for the period, we add compare the new assets balance with the old, taking into consideration new acquisitions.

d) Net working capital is the difference between current assets and current liabilities.

e) Debts paid off during the year can be obtained by comparing old debt balance with the new and additional debt issued during the period.

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3 years ago
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3 years ago
An increase in the expected rate of inflation will:______a. the real rate of interest.b. the nominal rate of interest.c. both th
liubo4ka [24]

Answer:

B

Explanation:

Inflation is a persistent rise in general price levels

Real rate of interest is interest rate adjusted for inflation.

Nominal rate of interest is real interest rate added with the real rate of interest

Nominal Interest Rate = Real rate of interest + inflation rate

If inflation is expected, it would be incorporated into the nominal rate of interest.

For example, if the nominal rate of interest is 9% and expected inflation is 2%. Nominal interest rate would become 11% (9% + 2%)

6 0
2 years ago
Kevin O’Leary suggests that Jenn and Kelley decrease the price of their product by 50% and sell 10 times as many. That is, he pr
Roman55 [17]

Answer:

The price elasticity of demand for Pursecases using the midpoint formula from this information is -2.45.

Explanation:

From the question, we have:

New quantity demanded = 60,000

Old quantity demanded = 6,000

New price = $20

Old price = $40

The formula for calculating the price elasticity of demand is as follows:

Price elasticity of demand = Percentage change in quantity demanded /

Percentage change in price ................ (1)

Where, based on the midpoint formula, we have:

Percentage change in quantity demanded = {(New quantity demanded - Old

quantity demanded) / [(New quantity demanded + Old quantity demanded) /

2]} * 100 = {(60,000 - 6,000) / [(60,000 + 6,000) / 2]} * 100 = 163.636363636364%

Percentage change in price = {(New price - Old price) / [(New price + Old

price) / 2]} * 100 = {(20 - 40) / [(20 + 40) / 2]} * 100 = -66.6666666666667%

Substituting the values into equation (1), we have:

Price elasticity of demand = 163.636363636364% / -66.6666666666667% = -2.45454545454546

Rounding to 2 decimal places, we have:

Price elasticity of demand = -2.45

Therefore, the price elasticity of demand for Pursecases using the midpoint formula from this information is -2.45.

3 0
2 years ago
In November and December 2020, Crane Company, a newly organized magazine publisher, received $79200 for 1,000 three-year subscri
Varvara68 [4.7K]

Answer:

Crane should report $26,400 as subscription revenue in Income Statement

 

Explanation:

Amount received towards Subscription = $79,200 for 3 years

Subscription revenue to be recognized in Income Statement of 2020 =

= $79,200 / 3

= $26,400

7 0
3 years ago
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