1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Alja [10]
2 years ago
15

On December 31, 2019, the unadjusted credit balance of the Allowance for Overvaluation of Inventories: Hope Branch ledger accoun

t in the accounting records of the home office of Farah Company was $60,000. The home office of Farah ships merchandise to the branch at a markup of 20% on billed price. For the fiscal year ended December 31, 2019, the branch had reported a net loss (based on billed prices of merchandise shipped from home office) of $18,400 and ending inventories (all received from home office) of $132,000 at billed prices.
Required:
Prepare journal entries for the home office of Farah Company on December 31, 2019, to record the foregoing information.
Business
1 answer:
Zigmanuir [339]2 years ago
5 0

Answer:

                                Journal entries

Date           Particulars                                    Debit         Credit

31, Dec 19  Investment in Branch Office     $132,000

                         To Inventories                                         $110,000

                         To Allowance for Overvaluation of        $20,000

                         Inventories

31, Dec 19    Profit and loss                          $18,400

                           To Investment in Branch Office            $18,400

31, Dec 19     Allowance for Overvaluation   $10,000

                     of Inventories

                           To Realized Gross Profit: Branch Sales  $10,000

Workings

1. Unrealized Inter-company Inventory Profit = (132,000/120) * 20 = $22,000

Shipment to Branch = 132,000 - 22,000 = $110,000

2. Unrealized Inter-company Inventory Profit = (60,000/120) * 2 = $10,000

You might be interested in
The greatest amount of satisfaction comes from which utility?
eimsori [14]

The greatest amount of satisfaction comes from good's consumption of utility or say utility maximizer.

<h3>What is the term about?</h3>

A utility maximizer is known to be a person that seeks to get the highest satisfaction or happiness.

Utility is known to be the happiness or benefit consumers gotten from a good's consumption.

Therefore, The greatest amount of satisfaction comes from good's consumption of utility or say utility maximizer

Learn more about utility from

brainly.com/question/24922430

#SPJ12

5 0
2 years ago
Causwell company began 2018 with 10,000 units of inventory on hand. the cost of each unit was $5.00. during 2018 an additional 3
nydimaria [60]

The amount of cost of goods sold using FIFO method is $110,000.

Hope this helps. :)

3 0
3 years ago
If your lifestyle budget is $50,000 a year, selecting a career earning $75,000 will most likely allow you to meet your lifestyle
Aleks [24]
This question is a True statement
7 0
3 years ago
Read 2 more answers
How to deal with a complainer in a business?
KengaRu [80]
File a formal complaint with human resorces
8 0
3 years ago
Read 2 more answers
According to Herman, one of the differences of managing a nonprofit versus a for-profit corporation is
marusya05 [52]
Managing because it's non profit
4 0
3 years ago
Other questions:
  • A company had beginning inventory of 11 units at a cost of $17 each on March 1. On March 2, it purchased 11 units at $28 each. O
    10·1 answer
  • You can offer investment products and services only if you are a registered representative of Northwestern Mutual Investment Ser
    6·1 answer
  • Sergio's employer covers 80% of the cost of a $3300-per-year health insurance plan and 70% of the cost of a $1400-per-year disab
    11·2 answers
  • The economizing problem is essentially one of deciding how to make the best use of a. limited resources to satisfy limited wants
    12·1 answer
  • Patagonia was one of the first companies to offer employees a child care program. plans such as child care, sick-leave pay, vaca
    15·1 answer
  • HELP I AM CONFUSED!!!
    9·1 answer
  • A firm must know where to position its product based on price and ________. promotional efforts communication quality region
    5·1 answer
  • 40 points Write a short note discussing how social factors affect economic and political systems
    14·1 answer
  • Which of the following is not a benefit of contributing to a retirement
    6·1 answer
  • Investor A has an initial wealth of $100 and a utility function of the form: U(w) = log(w) where w is her wealth at any time. In
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!