Eisha Company conducted a physical count on December 31, 2021 which showed inventory with a total cost of P2,800,000. Upon investigation, the following items were excluded from the count: * Goods sold to a customer which are being held for the customer to call the customer's convenience with a cost of P150,000. * A packing case containing a product amounting to P350,000 in the shipping room was not included in the physical count because it was marked on hold for shipping instructions. * Goods in process costing P180,000 held by an outside processor for further processing. A special machine costing P225,000 fabricated to order for a customer, was finished and specifically segregated at the back part of the shipping room on December 31, 2021. The customer was billed on that date and the machine was excluded from inventory although it was shipped on January 2, 2022.

Eisha Company conducted a physical count on December 31, 2021 which showed inventory with a total cost of P2,800,000. Upon investigation, the following items were excluded from the count: * Goods sold to a customer which are being held for the customer to call the customer's convenience with a cost of P150,000. * A packing case containing a product amounting to P350,000 in the shipping room was not included in the physical count because it was marked on hold for shipping instructions. * Goods in process costing P180,000 held by an outside processor for further processing. A special machine costing P225,000 fabricated to order for a customer, was finished and specifically segregated at the back part of the shipping room on December 31, 2021. The customer was billed on that date and the machine was excluded from inventory although it was shipped on January 2, 2022.

Name: What should be the reported amount of inventory on December 31, 2021?a
Uploaded: 2024-03-20T06:32:37.000Z
Channel: Bartleby
Description: What should be the reported amount of inventory on December 31, 2021?a.3,330,000 b.3,555,000 c.3,705,000 d.3,880,000 Eisha Company conducted a physical count on December 31, 2021 which showed inventory with a totalcost of P2,800,000. Upon inves

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter8: Inventories: Special Valuation Issues

Section: Chapter Questions

Problem 13P: Errors As controller of Lerner Company, which uses a periodic inventory system, you discover the...

See similar textbooks

Similar questions

Company Elmira reported the following cost of goods sold but later realized that an error had been made in ending inventory for year 2021. The correct inventory amount for 2021 was 32,000. Once the error is corrected, (a) how much is the restated cost of goods sold for 2021? and (b) how much is the restated cost of goods sold for 2022?
Errors As controller of Lerner Company, which uses a periodic inventory system, you discover the following errors in the current year: 1. Merchandise with a cost of 17,500 was properly included in the final inventory, but the purchase was not recorded until the following year. 2. Merchandise purchases are in transit under terms of FOB shipping point. They have been excluded from the inventory, but the purchase was recorded in the current year on the receipt of the invoice of 4,300. 3. Goods out on consignment have been excluded from inventory. 4. Merchandise purchases under terms FOB shipping point have been omitted from the purchases account and the ending inventory. The purchases were recorded in the following year. 5. Goods held on consignment from Talbert Supply Co. were included in the inventory. Required: For each error, indicate the effect on the ending inventory and the net income for the current year and on the net income for the following year.
What should be the reported amount of inventory on December 31, 2021? Eisha Company conducted a physical count on December 31, 2021 which showed inventory with a total cost of P2,800,000. Upon investigation, the following items were excluded from the count: * Goods sold to a customer which are being held for the customer to call the customer's convenience with a cost of P150,000. * A packing case containing a product amounting to P350,000 in the shipping room was not included in the physical count because it was marked on hold for shipping instructions. • Goods in process costing P180,000 held by an outside processor for further processing. • A special machine costing P225,000 fabricated to order for a customer, was finished and specifically segregated at the back part of the shipping room on December 31, 2021. The customer was billed on that date and the machine was excluded from inventory although it was shipped on January 2, 2022. O 3,330,000 O 3,555,000 O 3,705,000 O 3,880,000…
Rogers Corp. conducted a physical count on December 31, 2021 which revealed inventory with a cost of P 4,410,000. The following items were excluded from the physical count: Merchandise held by Rogers on consignment. • Merchandise shipped by Rogers on terms FOB Destination to a customer on December 31, 2019 and was received by the customer on January 5, 2020.. Merchandise shipped by Rogers on terms FOB Shipping Point to a customer on December 31, 2019 and was received by the customer on January 5, 2020. Merchandise shipped by the supplier on terms FOB Destination on December 31, 2019 and was received by Rogers on January 5, 2020.. .P 610,000 380,000 460,000 830,000 • Merchandise purchased on terms FOB Shipping Point, was shipped by the supplier on December 31, 2019 and was received by Rogers on January 5, 2020... What is the correct amount of inventory as of December 31, 2019? В. Р 4,690,000 510,000 A. P5,300,000 C. P3,800,000 D. P 4,920,000
BCD Company conducted a physical count on December 31, 2019 which showed inventory with a total cost of P4,000,000However, further investigation revealed that the following items were excluded from the count: Goods sold to a customer which are being heldfor the customer to call at the customer'sconvenience 220,000 A packing case containing a product standing inthe shipping room was not included in thephysical count because it was marked "hold forshipping instructions" 610,000 Goods in process held by an outside processorfor further processing 250,000 A special machine, fabricated to order for acustomer, was finished and specificallysegregated at the back part of the shippingroom on December 31, 2019. The customer was 220,000billed on that date and the machine wasexcluded from inventory although it wasshipped on January 2, 2020. 220,000 Goods shipped to the entity FOB destination onDecember 26, 2019 were received on January2, 2020. The invoice cost is included in…
Eta Inc. conducted a physical count on December 31, 2019 which revealed merchandise with ta total cost of P 5,000,000. However, further investigation revealed that the following items were excluded from the count. Goods sold to customers, which are being held for the customer to call at the customer's convenience with a cost of P 200,000. A packing case containing a product costing P 500,000 was standing in the shipping room when the physical inventory was taken. It was not included in the inventory because it was marked “Hold for Shipping Instructions". A special machine costing P 250,000, fabricated to order for a customer, was finished and specifically segregated at the back part of the shipping room on January 2, 2020. What is the correct amount of inventory that should be reported on December 31, 2019? А. Р5,950,000 В. Р 5,750,000 C. P5,500,000 D. P 5,700,000
The Apollo Company conducted a physical count on December 31, 2021 which revealed in inventory with a cost of P4,410,000. The following items were excluded from the physical count: • Merchandise held by Apollo on consignment, P610,000. • Merchandise shipped by Apollo, FOB Destination to a customer on December 31, 2021 and was received by the customer on January 8, 2022, P380,000. • Merchandise shipped by Apollo, FOB Shipping Point to a customer on December 31, 2021 and was received by the customer on January 8, 2022, P460,000. • Merchandise shipped by a vendor, FOB Destination on December 31, 2021 was received by Apollo on January 8, 2022, P830,000. • Merchandise purchased FOB Shipping Point was shipped by the supplier on December 31, 2021 and received by Apollo on January 8, 2022, P510,000. What is the correct amount of inventory on December 31, 2021? P3,800,000 P5,300,000 P4,690,000 O P4,920,000
Delta Corp. conducted a physical count on December 31, 2019 which revealed inventory with a cost of P 4,410,000. The following items were excluded from the physical count: Merchandise held by Delta Corp. on consignment. • Merchandise shipped by Delta Corp. on terms FOB Destination to a customer on December 31, 20o19 and was received by the customer on January 5, 2020.. • Merchandise shipped by Delta Corp. on terms FOB Shipping Point to a customer on December 31, 2019 and was received by the customer on January 5, 2020.. • Merchandise shipped by the supplier on terms FOB Destination on December 31, 2019 and was received by Delta Corp. on January 5, 2020.. • Merchandise purchased on terms FOB Shipping Point, was shipped by the supplier on December 31, 2019 and was received by Delta Corp. on January 5, 2020.. 610,000 380,000 460,000 830,000 510,000 What is the correct amount of inventory as of December 31, 2019? A. P5,300,000 В. Р4,690,000 С. Р 3,800,000 D. P4,920,000
At December 31, 2023, the accounting staff of Tender Company submitted an inventory list that showed a total of P2,350,000. The following information needs additional analysis to determine whether the items should be included or excluded in inventory: Merchandise costing P40,000 were transferred to the delivery department on December 28 for shipment on January 3, 2024. This inventory was excluded from the inventory total. Supplier's invoice for P18,000 worth of merchandise dated December 27, 2023 was received through the mails on December 30, 2023. Shipment term is FOB destination. Since the goods arrived only on January 4, 2024 the goods were not included in the year-end inventory. Goods valued at P200,000 were received from a supplier for approval and were included in the ending inventory. The company informed the supplier by facsimile message of the acceptance of goods on January 2024. On December 27, 2023, an order for P25,000 worth of merchandise was placed. This was included…
The December 31, 2024, inventory of Tog Company, based on a physical count, was determined to be $465,000. Included in that count was a shipment of goods received from a supplier at the end of the month that cost $65,000. The purchase was recorded and paid for in 2025. Another supplier shipment costing $27,500 was correctly recorded as a purchase in 2024. However, the merchandise, shipped FOB shipping point, was not received until 2025 and was incorrectly omitted from the physical count. A third purchase, shipped from a supplier FOB shipping point on December 28, 2024, did not arrive until January 3, 2025. The merchandise, which cost $95,000, was not included in the physical count and the purchase has not yet been recorded. The company uses a periodic inventory system. Required: Determine the correct December 31, 2024, inventory balance and, assuming that the errors were discovered after the 2024 financial statements were issued, analyze the effect of the errors on 2024 cost of goods…
. At December 31, 2021, the accounting staff of Persimmon Company submitted an inventory list that showed a total of P2,350,000. The following information needs additional analysis to determine whether the items should be included or excluded in inventory: Merchandise costing P40,000 were transferred to the delivery department on December 28 for shipment on January 3, 2022. This inventory was excluded from the inventory total. Supplier's invoice for P18,000 worth of merchandise dated December 27, 2021 was received through the mails on December 30, 2021. Shipment term is FOB destination. Since the goods arrived only on January 4, 2022, the goods were not included in the year-end inventory. On December 27, 2021, an order for P25,000 worth of merchandise was placed. This was included in the year-end inventory although the goods were received only on January 5, 2022. Seller shipped the goods FOB destination. What is the correct merchandise inventory of Persimmon Company at December 31,…
During your review of the Hearbeat Corporation for the year ended December 31, 2020, you found the following information relating to certain inventory transactions from your observation of the client’s physical count and review of sales and purchases cutoff: a. Goods costing P180,000 were received from a vendor on January 3, 2021. The goods were not included in the physical count. The related invoice was received and recorded on December 30, 2020. The goods were shipped on December 31, 2020, terms FOB shipping point. b. Goods costing P200,000, sold for P300,000, were shipped on December 31, 2020, and were received by the customer on January 2, 2021. The terms of the invoice were FOB shipping point. The goods were included in the ending inventory for 2020 and the sale was recorded in 2021. c. The invoice for goods costing P150,000 was received and recorded as a purchase on December 31, 2020. The related goods shipped FOB destination were received on January 2, 2021 but were included in…