# Inventories and Additional Valuation Issues Chap 9

667 Words3 Pages
Inventories and Additional Valuation Issues Chapter 9 E 9-14, P 9-1 , P 9-2 , P 9-5 E9-14: Beginning Inventory 170,000 Purchases for year 450,000 Purchase Returns 30,000 Sales 650,000 Sales Returns 24,000 Rate of gross profit on net sales 30% Merchandise with a selling price of \$21,000 remained undamaged after the fire. Damaged merchandise with an original selling price of \$15,000 had a net realizable value of \$5,300. Compute the amount of the loss as a result of the fire, assuming that the corporation had no insurance coverage. My Calculations: Beginning Inventory 170,000 Add: Purchases 450,000 Less: Purchase Returns -30,000 Cost of goods available for sale 590,000 Sales 650,000 Less: Sales Returns -24,000 626,000 Less: 30% (626000 x .30) -187,800 Less: Cost of Goods Sold 438,200 Estimated Ending Inventory 151,800 Less: undamaged inventory -21,000 Estimated Lost Inventory 130,800 P9-1: A. \$460 B. \$430 C. \$610 D. \$960 P9-2: Net Realizable Net Realizable Value Less a Designated Final Replacement Sales Value Profit Margin Normal Market Inventory Cost Cost Price (Ceiling) (Floor) Profit Value Value Aluminum siding 70,000 62,500 64,000 56,000 50,900 5,100 56,000 56,000 Cedar shake siding 86,000 79,400 94,000 84,800 77,400 7,400 79,400 79,400 Louvered glass doors 112,000 124,000 186,400 168,300 149,800 18,500 149,800 149,800 Thermal windows 140,000 126,000 154,800 140,000 124,600 15,400 126,000 126,000 Total \$408,000 \$391,900 \$499,200 \$449,100 402,700 \$46,400 411,200 411,200 (a) (1) Allowance to Reduce Inventory to Market should be Dr. of 30,700. This will