College Accounting, Chapters 1-27
23rd Edition
ISBN: 9781337794756
Author: HEINTZ, James A.
Publisher: Cengage Learning,
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Chapter 14, Problem 1CP
Block Foods, a retail grocery store, has agreed to purchase all of its merchandise from Square Wholesalers. In return. Block receives a special discount on purchases. Over recent months, Square noticed that purchases by Block had been falling off. At first, Square simply thought that business might be down for Block and was hopeful that their purchases would pick up. When business with Block did not return to a normal level, Square requested financial statements from Block. Squares records indicate that Block purchased $300,000 worth of merchandise during 20-1, the most recent year.
Selected information taken from Block's financial statements is as follows:
REQUIRED
Compute net purchases made by Block during 20-1. Does it appear that Block violated the agreement?
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Exercise 6-1
Umatilla Bank and Trust is considering giving Sage Hill Inc. a loan. Before doing so, it decides that further discussions with Sage Hill Inc's accountant may be desirable. One area of particular concern is the Inventory account, which has
year-end balance of $253,760. Discussions with the accountant reveal the following.
1. Sage Hill Inc. sold goods costing $55,290 to Hemlock Company FOB shipping point on December 28. The goods are not expected to reach Hemlock until January 12. The goods were not induded in the physical inventory because the
were not in the warehouse.
2. The physical count of the inventory did not indude goods costing $96,030 that were shipped to Sage Hill Inc. FOB…
Tri-State Bank and Trust is considering giving Cheyenne Corp. a loan. Before doing so, management decides that further discussions with Cheyenne’s accountant may be desirable. One area of particular concern is the inventory account, which has a year-end balance of $303,500. Discussions with the accountant reveal the following.
1.
Cheyenne shipped goods costing $32,400 to Sorci Company, FOB shipping point, on December 28. The goods are not expected to arrive at Sorci until January 12. The goods were not included in the physical inventory because they were not in the warehouse.
2.
The physical count of the inventory did not include goods costing $91,000 that were shipped to Cheyenne FOB destination on December 27 and were still in transit at year-end.
3.
Cheyenne received goods costing $29,800 on January 2. The goods were shipped FOB shipping point on December 26 by Solita Co. The goods were not included in the physical count.
4.
Cheyenne shipped goods costing $44,000…
Tri-State Bank and Trust is considering giving Concord Company a loan. Before doing so, management decides that further discussions with Concord’s accountant may be desirable. One area of particular concern is the inventory account, which has a year-end balance of $345,000. Discussions with the accountant reveal the following.
1.
Concord sold goods costing $32,000 to Lilja Company, FOB shipping point, on December 28. The goods are not expected to arrive at Lilja until January 12. The goods were not included in the physical inventory because they were not in the warehouse.
2.
The physical count of the inventory did not include goods costing $95,000 that were shipped to Concord FOB destination on December 27 and were still in transit at year-end.
3.
Concord received goods costing $23,000 on January 2. The goods were shipped FOB shipping point on December 26 by Brent Co. The goods were not included in the physical count.
4.
Concord sold goods costing $34,000 to Jesse…
Chapter 14 Solutions
College Accounting, Chapters 1-27
Ch. 14 - Under the periodic inventory system, the beginning...Ch. 14 - Under the periodic inventory system, the ending...Ch. 14 - The cash received in advance before delivering a...Ch. 14 - Unearned revenue is adjusted into an expense...Ch. 14 - Sales Returns and Allowances is classified as a...Ch. 14 - Under the periodic inventory system, what account...Ch. 14 - Under the periodic inventory system, what account...Ch. 14 - Under the periodic inventory system, what account...Ch. 14 - Unearned revenue is classified as what type of...Ch. 14 - Under the perpetual inventory method, what account...
Ch. 14 - Prepare the cost of goods sold section for Josephs...Ch. 14 - The Venice Theatre sold and collected cash of...Ch. 14 - Information relating to inventory for Janie Par...Ch. 14 - Using the spreadsheet provided below, prepare the...Ch. 14 - Prob. 5CECh. 14 - A firm is preparing to make adjusting entries at...Ch. 14 - What spreadsheet amounts are used to compute cost...Ch. 14 - Why are both the debit and credit amounts in the...Ch. 14 - What is an unearned revenue?Ch. 14 - Give three examples of unearned revenue.Ch. 14 - Prob. 6RQCh. 14 - Prob. 7RQCh. 14 - A firm is preparing to make adjusting entries at...Ch. 14 - ADJUSTMENT FOR MERCHANDISE INVENTORY USING T...Ch. 14 - ADJUSTMENT FOR MERCHANDISE INVENTORY USING T...Ch. 14 - CALCULATION OF COST OF GOODS SOLD: PERIODIC...Ch. 14 - CALCULATION OF COST OF GOODS SOLD: PERIODIC...Ch. 14 - ADJUSTMENT FOR UNEARNED REVENUES USING T ACCOUNTS...Ch. 14 - MERCHANDISE INVENTORY ADJUSTMENTS: PERIODIC...Ch. 14 - DETERMINING THE BEGINNING AND ENDING INVENTORY...Ch. 14 - JOURNALIZE ADJUSTING ENTRIES FOR A MERCHANDISING...Ch. 14 - JOURNAL ENTRIES UNDER THE PERPETUAL INVENTORY...Ch. 14 - ADJUSTMENTS FOR A MERCHANDISING BUSINESS:...Ch. 14 - JOURNALIZE ADJUSTING ENTRY FOR INVENTORY...Ch. 14 - PREPARATION OF ADJUSTMENTS ON A SPREADSHEET FOR A...Ch. 14 - WORKING BACKWARD FROM ADJUSTED TRIAL BALANCE TO...Ch. 14 - ADJUSTMENT FOR MERCHANDISE INVENTORY USING T...Ch. 14 - ADJUSTMENT FOR MERCHANDISE INVENTORY USING T...Ch. 14 - CALCULATION OF COST OF GOODS SOLD: PERIODIC...Ch. 14 - CALCULATION OF COST OF GOODS SOLD: PERIODIC...Ch. 14 - ADJUSTMENT FOR UNEARNED REVENUES USING T ACCOUNTS...Ch. 14 - MERCHANDISE INVENTORY ADJUSTMENTS: PERIODIC...Ch. 14 - DETERMINING THE BEGINNING AND ENDING INVENTORY...Ch. 14 - JOURNALIZE ADJUSTING ENTRIES FOR A MERCHANDISING...Ch. 14 - JOURNAL ENTRIES UNDER THE PERPETUAL INVENTORY...Ch. 14 - ADJUSTMENTS FOR A MERCHANDISING BUSINESS:...Ch. 14 - JOURNALIZE ADJUSTING ENTRY FOR INVENTORY...Ch. 14 - Prob. 12SPBCh. 14 - WORKING BACKWARD FROM ADJUSTED TRIAL BALANCE TO...Ch. 14 - A friend of yours recently opened Abracadabra, a...Ch. 14 - Jason Tierro, an inventory clerk at Lexmar...Ch. 14 - John Neff owns and operates Waikiki Surf Shop. A...Ch. 14 - Block Foods, a retail grocery store, has agreed to...
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