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Problem 1

DATA:

Beginning 0 @ $0 = $0

1st

Purchase 125 @ $60 = $7,500

2nd

Purchase 275 @ $70 = $19,250

3rd

Purchase 500 @ $100 = $50,000

UNITS 900 76,750

Ending 225

Units Sold 675

1. Specific Identification

SOLD-> 100 from 1st purchase, SOLD-> 200 from 2nd. SOLD 375 from the 3rd purchase

A. Create the entry to record Cost of Sales under Specific Identification:

DEBIT CREDIT

Cost of Goods Sold $57,500

Inventory $57,500

B. What is the value of Ending Inventory under Specific Identification:

Ending inventory value under specific identification

$19,250.00

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2. FIFO

A. Create the entry to record Cost of Sales under FIFODEBIT CREDIT

Cost of Goods Sold $54,250.00

Inventory $54,250.00

B. What is the value of Ending Inventory under FIFO:

Ending inventory value under FIFO = $22,500

3. LIFO

A. Create the entry to record Cost of Sales under LIFODEBIT CREDIT

Cost of Goods Sold $62,250

Inventory $62,250

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B. What is the value of Ending Inventory under LIFO:

Ending inventory value under LIFO = $14,500

4. Weighted AverageA. Create the entry to record Cost of Sales under Weighted Average

DEBIT CREDIT

Cost of Goods Sold $57,564

Inventory $57,564.00

B. What is the value of Ending Inventory under Weighted Average:

Ending inventory value umder Weighted Average= $19,188

Problem 2 GROSS PROFIT METHOD estimating Ending Inventory

Data:Beginning inventory 50,000$

Purchases 25,000$

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Sales 200,000$Assume the Company has a Gross Profit Percentage of 25%

In the schedule show the detail on how Ending Inventory is calculated:

Gross Profit of 25 % = $200,000.00 x .25 = $50,000.00

Cost of Goods Available($50,000 + $25,000) $75,000.00

Cost of Goods Sold(200,000.00 - $50,000.00) $125,000.00

Ending Inventory(75,000 - $125,000.00) ($50,000.00)

Estimated Cost of Ending Inventory 75,000

Problem 3 Create the bank reconciliation for MY COMPANY INC.

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Swindle Bank Incorporation

Bank Statement

December 31st

Opening Balance 25,000.00$

Disbursements Date CK # Amount

12/1/2008 100 123.00$

12/2/2008 101 125.46$

12/3/2008 102 127.97$

12/4/2008 103 130.53$

12/5/2008 104 133.14$

12/6/2008 105 135.80$

12/7/2008 106 138.52$

12/8/2008 107 141.29$

12/9/2008 108 144.11$

12/10/2008 109 147.00$

12/11/2008 110 149.94$

12/12/2008 111 152.94$

12/13/2008 112 155.99$12/14/2008 113 159.11$

12/15/2008 114 162.30$

12/16/2008 115 165.54$

12/17/2008 116 168.85$

12/18/2008 117 172.23$

12/19/2008 118 175.67$

12/20/2008 119 179.19$

12/21/2008 120 182.77$

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Total (3,171.35)$

Deposits 12/1/2008 555.00$

12/2/2008 666.00$

12/3/2008 777.00$

12/4/2008 111.00$

12/5/2008 222.00$12/6/2008 333.00$

12/7/2008 444.00$

12/8/2008 555.00$

12/9/2008 666.00$

12/10/2008 777.00$

12/11/2008 888.00$

12/22/2008 999.00$

12/23/2008 111.00$

12/24/2008 222.00$12/25/2008 333.00$

Total 7,659.00$

Other:

Service Charges (222.00)$

Interest 555.00$

Net 333.00$

Total Monthly Activity 4,820.65$

Balance per Bank December 31st 29,820.65$

MY COMPANY INC.

Check Book

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Opening Balance 25,000.00$

Date CK # Amount Deposit

12/1/2008 100 123.00$ 555.00$ 25,432.00$

12/2/2008 101 125.46$ 666.00$ 25,972.54$12/3/2008 102 127.97$ 777.00$ 26,621.57$

12/4/2008 103 130.53$ 111.00$ 26,602.04$

12/5/2008 104 133.14$ 222.00$ 26,690.90$

12/6/2008 105 135.80$ 333.00$ 26,888.10$

12/7/2008 106 138.52$ 444.00$ 27,193.58$

12/8/2008 107 141.29$ 555.00$ 27,607.29$

12/9/2008 108 144.11$ 666.00$ 28,129.18$

12/10/2008 109 147.00$ 777.00$ 28,759.18$

12/11/2008 110 149.94$ 888.00$ 29,497.25$12/12/2008 111 152.94$ 999.00$ 30,343.31$

12/13/2008 112 155.99$ 333.00$ 30,520.32$

12/14/2008 113 159.11$ 444.00$ 30,805.21$

12/15/2008 114 162.30$ 111.00$ 30,753.91$

12/16/2008 115 165.54$ 222.00$ 30,810.37$

12/17/2008 116 168.85$ 333.00$ 30,974.52$

12/18/2008 117 172.23$ 444.00$ 31,246.29$

12/19/2008 118 175.67$ 555.00$ 31,625.61$

12/20/2008 119 179.19$ 666.00$ 32,112.42$

12/21/2008 120 182.77$ 777.00$ 32,706.65$

12/22/2008 121 186.43$ 999.00$ 33,519.23$

12/23/2008 122 190.16$ 111.00$ 33,440.07$

12/24/2008 123 193.96$ 222.00$ 33,468.11$

12/25/2008 124 197.84$ 333.00$ 33,603.27$

12/26/2008 125 201.79$ 444.00$ 33,845.48$

12/27/2008 126 205.83$ 666.00$ 34,305.65$

12/28/2008 127 209.95$ 777.00$ 34,872.70$

12/29/2008 128 214.15$ 555.00$ 35,213.56$

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12/30/2008 129 218.43$ 888.00$ 35,883.13$

MY COMPANY INC.

Bank Reconciliation

Balance per the Books: $35,883.13

Add/ (Deduct): Deposits In transit

Date Amount

12/13/2008 333.00$

12/14/2008 444.00$

12/18/2008 444.00$

12/19/2008 555.00$

12/20/2008 666.00$12/21/2008 777.00$

12/22/2008 999.00$

12/23/2008 111.00$

12/24/2008 222.00$

12/25/2008 333.00$

12/26/2008 444.00$

12/27/2008 666.00$

12/28/2008 777.00$

12/29/2008 555.00$

12/30/2008 888.00$

TOTAL MINUS 8,214.00$

Add: Checks Outstanding

DATE CHECK # AMOUNT

12/22/2008 121 186.43$

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12/23/2008 122 190.16$

12/24/2008 123 193.96$

12/25/2008 124 197.84$

12/26/2008 125 201.79$

12/27/2008 126 205.83$

12/28/2008 127 209.95$

12/29/2008 128 214.15$

12/30/2008 129 218.43$

TOTAL PLUS 1,818.54$

Other Items

Service Charges (222.00)$

Interest 555.00$

TOTAL PLUS $333.00

BALANCE PER THE BANK 29,820.67$ OFF 2 cent!

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Problem 4 Create the Journal Entry for the reconciliation above

Miscellaeous Expense $222.00

Cash $222.00

To record bank service chgs 12/08

Cash $555.00

Interest Revenue $555.00

To record interest paid by bank

Miscellaeous Expense 0.02$Cash 0.02$

To offset adding error 12/08 bank statement

Problem 5 Create the Entry for the following Petty Cash Slips.

Ticket 1 Amount $1,234.00 Ticket 2 Amount $ 330.00

Date: 3/1/09 Date: 3/2/09

Paid to Charlie Paid to Frank

For Travel Approved: Me For Travel Approved: Me

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Ticket 3 Amount $999.00 Ticket 4 Amount $ 177.00

Date: 3/11/09 Date: 3/20/09

Paid to Tom Paid to Linda

For Office Approved: Me For Lunch Approved: MeSupplies

Ticket 5 Amount $699.00 Ticket 6 Amount $ -4,900.00

Date: 3/21/09 Date: 3/22/09

Paid to Tim Paid to you

For desk Approved: Me Replenish Approved: Me

petty cash

Ticket 7 Amount $299.00 Ticket 8 Amount $ 880.00

Date: 3/23/09 Date: 3/24/09

Paid to Lilly Paid to you

For paper Approved: Me For: snow Approved: Me

removal

Ticket 9 Amount - $2,000.00 Ticket 10 Amount $ 80.00

Date: 3/25/09 Date: 3/26/09

Paid to you Paid Dick

Replenish Approved: Me For: Coffee Approved: Me

petty cash supplies

Ticket 11 Amount $330.00 Ticket 12 Amount $ 10.00

Date: 3/27/09 Date: 3/28/09

Paid to David Paid Sam

For: Travel Approved: Me For: Supplies Approved: Me

Ticket 14 Amount $110.00 Ticket 15 Amount $ 227.00

Date: 3/29/09 Date: 3/30/09

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Paid to Cindy Paid Sam

For: desk pad Approved: Me For: window Approved: Me

washer

Petty Cash Entries

Date Description Ticket Debit Credit

3/1/2009 Travel 1,234.00$

3/1/2009 Cash 1,234.00$

3/2/2009 Travel 330.00$

3/2/2009 Cash 330.00$

3/11/2009 Office Supplies 999.00$

3/11/2009 Cash 999.00$

3/20/2009 Lunch Expense 177.00$

3/20/2009 Cash 177.00$

3/21/2009 Desk Expense 699.00$

3/21/2009 Cash 699.00$

3/22/2009 Cash 4,900.00$

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3/23/2009 Paper Expense 299.00$

3/23/2009 Cash 299.00$

3/24/2009 Snow Removal Expense 8.80$

3/24/2009 Cash 8.80$

3/25/2009 Cash 2,000.00$

3/1/2009 BEGINNING BALANCE UNKNOWN? 0 -$

3/22/2009 To petty cash acct 4,900.00$

3/25/2009 To petty cash acct 2,000.00$

3/31/2009 Travel Expense (ticket 1,2 & 11) 1,894.00$

Office Supplies (ticket 3,7,12,14 &15) 1,645.00$

Office Funiture Expense (ticket 5) 699.00$

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Food Expense (ticket 4 & 10) 257.00$

Landscaping/maintenace Expense (ticket 8) 880.00$

Cash in bank 1,525.00$