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ACC 422 Week 3 WileyPLUS Assignment

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ACC 422 Week 3 WileyPLUS Assignment

 Exercise 9-1 The inventory of Oheto Company on December 31, 2013, consists of the following items.
 Part No. Quantity Cost per Unit Cost to Replace per Unit 110 620 \$126 \$133 111 1,140 80 69 112 580 106 101 113 230 226 239 120 450 273 277 121 1,650 21 19 122 330 319 313

Part No. 121 is obsolete and has a realizable value of \$0.7 each as scrap.

(a) Determine the inventory as of December 31, 2013, by the lower-of-cost-or-market method, applying this method directly to each item.

(b) Determine the inventory by the lower-of-cost-or-market method, applying the method to the total of the inventory.

 Exercise 9-12

Astaire Company uses the gross profit method to estimate inventory for monthly reporting purposes. Presented below is information for the month of May.

 Inventory, May 1 \$ 171,000 Purchases (gross) 655,400 Freight-in 31,400 Sales 1,057,500 Sales returns 82,500 Purchase discounts 12,990

(a) Compute the estimated inventory at May 31, assuming that the gross profit is 25% of sales.

(b) Compute the estimated inventory at May 31, assuming that the gross profit is 25% of cost.

 Exercise 10-5 Allegro Supply Company, a newly formed corporation, incurred the following expenditures related to Land, to Buildings, and to Machinery and Equipment.
 Abstract company’s fee for title search \$1,752 Architect’s fees 10,683 Cash paid for land and dilapidated building thereon 310,040 Removal of old building \$67,400 Less: Salvage 18,535 48,865 Interest on short-term loans during construction 24,938 Excavation before construction for basement 64,030 Machinery purchased (subject to 2% cash discount, which was not taken) 219,050 Freight on machinery purchased 4,516 Storage charges on machinery, necessitated by noncompletion of building when machinery was delivered 7,347 New building constructed (building construction took 6 months from date of purchase of land and old building) 1,634,450 Assessment by city for drainage project 5,392 Hauling charges for delivery of machinery from storage to new building 2,089 Installation of machinery 6,740 Trees, shrubs, and other landscaping after completion of building (permanent in nature) 18,198

Determine the amounts that should be debited to Land, to Buildings, and to Machinery and Equipment. Assume the benefits of capitalizing interest during construction exceed the cost of implementation.

 Exercise 10-12

Below are transactions related to Impala Company.

 (a) The City of Pebble Beach gives the company 5 acres of land as a plant site. The fair value of this land is determined to be \$90,900. (b) 14,000 shares of common stock with a par value of \$52 per share are issued in exchange for land and buildings. The property has been appraised at a fair value of \$909,000, of which \$186,500 has been allocated to land and \$722,500 to buildings. The stock of Impala Company is not listed on any exchange, but a block of 100 shares was sold by a stockholder 12 months ago at \$68 per share, and a block of 200 shares was sold by another stockholder 18 months ago at \$60 per share. (c) No entry has been made to remove from the accounts for Materials, Direct Labor, and Overhead the amounts properly chargeable to plant asset accounts for machinery constructed during the year. The following information is given relative to costs of the machinery constructed.

 Materials used \$12,880 Factory supplies used 970 Direct labor incurred 17,030 Additional overhead (over regular) caused by construction of machinery, excluding factory supplies used 2,570 Fixed overhead rate applied to regular manufacturing operations 60% of direct labor cost Cost of similar machinery if it had been purchased from outside suppliers 45,020

Prepare journal entries on the books of Impala Company to record these transactions. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)