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soldier1979 [14.2K]
3 years ago
13

Amsterdam Company uses a periodic inventory system. For April, when the company sold 600 units, the following information is ava

ilable. Units Unit Cost Total Cost April 1 inventory 250 $10 $ 2,500 April 15 purchase 400 12 4,800 April 23 purchase 350 13 4,550 1,000 $11,850 Compute the April 30 inventory and the April cost of goods sold using the average-cost method.
Business
1 answer:
zavuch27 [327]3 years ago
7 0

Answer:

The April 30 inventory and the April cost of goods sold using the average-cost method is $7,110 and $ $4,740 respectively

Explanation:

The computation of the average cost per unit is shown below:

= (Beginning inventory units × price per unit + purchase inventory units × price per unit + purchase inventory units × price per unit ) ÷ (Beginning inventory units + purchase inventory units + purchase inventory units)

= (250 units × $10 + 400 units × $12 + 350 units × $13) ÷ (250 units + 400 units + 350 units)

= ($2,500+ $4,800 + $4,550) ÷ (1,000 units)

= ($11,850) ÷ (1,000 units)

= $11.85

Now the cost of goods sold equals to

= (Beginning inventory units × average cost per unit + purchase inventory units × average cost per unit - ending inventory units × average cost per unit)

= (250 units × $10 + 400 units × $12 + 350 units × $13) - (400 units × $11.85)

= $11,850 - $4.,740

= $7,110

And, the ending inventory units equal to

= (Ending inventory units × average cost per unit)

= (400 units × $11.85)

= $4,740

The ending inventory units = 1,000 - 600 = 400 units

You might be interested in
The cash account for American Medical Co. at April 30 indicated a balance of $334,985. The bank statement indicated a balance of
Bas_tet [7]

Answer:

1. Cash balance according to bank statement $370,000

Cash balance according to company’s records $370,000

2. a. April 30

Dr Cash $42,000

Cr Notes Receivable $40,000

Cr Interest Income / Interest Revenue $2,000

b. April 30

Dr Accounts Payable - Targhee Supply Co $6,840

Dr Miscellaneous Expenses [Bank service charge] $145

Cr Cash $6,985

3. $370,000

Explanation:

1. Preparation of a bank reconciliation

AMERICAN MEDICAL COMPANY

Bank Reconciliation

April 30

Cash balance according to bank statement $388,600

Add: Deposit of April 30, Not recorded by bank $42,500

Add: Bank Error in Charging check as $420 instead of $240 [$420 - $240] $180

Deduct: Outstanding Checks $61,280

Adjusted balance $370,000

Cash balance according to company’s records $334,985

Add: Note and Interest Collected by bank $42,000

Deduct: Error in Recording Check [$7,600 - $760] $6,840

Deduct: Bank Service Charges $145

Adjusted balance $370,000

2. Preparation of Journal entries.

Journal entries

a. April 30

Dr Cash $42,000

Cr Notes Receivable $40,000

Cr Interest Income / Interest Revenue $2,000

b. April 30

Dr Accounts Payable - Targhee Supply Co [$7,600 - $760] $6,840

Dr Miscellaneous Expenses [Bank service charge] $145

Cr Cash $6,985

($6,840+$145)

3. Based on the information given If a balance sheet is prepared for American Medical Co. on April 30, the amount that should be reported as cash will be $370,000

8 0
3 years ago
4.
valentina_108 [34]
<span>Salary is the correct answer. </span>
3 0
3 years ago
Denny Corporation is considering replacing a technologically obsolete machine with a new state-of-the-art numerically controlled
inn [45]

Answer:

26.4%.

Explanation:

Net Profit:

= Saving of Labor & other Costs - Maintenance Cost of Machine -  Depreciation On Machine (100,000/ 16 years)

= $40,000 - $10,000 - $6,250

= $23,750

Initial Investment:

= Cost of new Machine - Salvage value of old machine

= $100,000 - $10,000

= $90,000

Simple Rate of Return = Net Profit ÷ Initial Investments

= $23,750 ÷ $90,000

= 0.264 × 100

= 26.4%

5 0
3 years ago
On March 1, 2021, Bearcat lends an employee $20,000. The employee signs a note requiring principal and interest at 9% to be paid
almond37 [142]

Answer:

Debit interest receivable $1,500

Credit interest revenue $1,500

Explanation:

Adjust entries are used in accounting to record accrued revenue or expense at the end of an accounting period.

On March 1, 2021, Bearcat lends an employee $20,000. The employee signs a note requiring principal and interest at 9% to be paid on February 28, 2022.

We are to calculate the adjustment at December 31, 2021.

We need to calculate interest accrued at year end. The loan would have stayed for 10 months.

Interest= principal* rate* time

Interest= 20,000* 0.09* (10/12)

Interest = $1,500

So we will debit interest receivable for $1,500 and credit interest revenue.

5 0
3 years ago
I would like to set up a company that has operational flexibility and tax efficiencies, but I would also like reduce my personal
Natalka [10]
Aisisiizuddyhee. Shsdiuejebsvz
6 0
3 years ago
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