Introduction to Economics

At the beginning of 2013, a company adopts the dollar-value LIFO inventory method for its one inventory pool. The pool’s value on that date was $1,400,000. The 2013 ending inventory valued at year-end costs was $1,664,000 and the year-end cost index was 1.04. Calculate the inventory value at the end of 2013 using the dollar-value LIFO method.

You were recently hired to work in the controller’s office of the Balboa Lumber Company. Your boss, Alfred Eagleton, took you to lunch during your first week and asked a favor. “Things have been a little slow lately, and we need to borrow a little cash to tide us over. Our inventory has been building up and the CFO wants to pledge the inventory as collateral for a short-term loan. But I have a better idea.” Mr. Eagleton went on to describe his plan. “On July 1, 2013, the first day of the...

Kelly Corporation shipped goods to a customer f.o.b. destination on December 29, 2013. The goods arrived at the customer’s location in January. In addition, one of Kelly’s major suppliers shipped goods to Kelly f.o.b. shipping point on December 30. The merchandise arrived at Kelly’s location in January. Which shipments should be included in Kelly’s December 31 inventory?

McIntyre Company adheres to a policy of depositing all cash receipts in a bank account and making all payments by check. The cash account as of December 31 has a credit balance of $1,850, and there is no undeposited cash on hand. (a)Assuming no errors occurred during journalizing or posting, what caused this unusual balance? (b)Is the $1,850 credit balance in the cash account an asset, a liability, owner’s equity, a revenue, or an expense?

Jose Loder established Bronco Consulting on August 1, 2014. The effect of each transaction and the balances after each transaction for August are shown below.

On October 1, 2014, Kevin Bosley established Sunrise Realty. Kevin completed the following transactions during the month of October: a. Opened a business bank account with a deposit of $18,000 from personal funds. b. Purchased office supplies on account, $3,200. c. Paid creditor on account, $1,800. d. Earned sales commissions, receiving cash, $36,750. e. Paid rent on office and equipment for the month, $4,000. f. Withdrew cash for personal use, $3,000. g. Paid automobile expenses (includi...

The following is a list of well-known companies. 1. Alcoa Inc. 2. Boeing 3. Caterpillar 4. Citigroup Inc. 5. CVS 6. Dow Chemical Company 7. eBay Inc. 8. FedEx 9. Ford Motor Company 10. Gap Inc. 11. H&R Block 12. Hilton Hospitality, Inc. 13. Procter & Gamble 14. SunTrust 15. Walmart Stores, Inc. a. Indicate whether each of these companies is primarily a service, merchandise, or manufacturing business. If you are unfamiliar with the company, use the Internet to locate the company...

The following selected transactions were completed by Reuben’s Delivery Service during October: 1. Received cash from owner as additional investment, $20,000. 2. Purchased supplies for cash, $900. 3. Paid rent for October, $3,000. 4. Paid advertising expense, $2,500. 5. Received cash for providing delivery services, $23,100. 6. Billed customers for delivery services on account, $41,750. 7. Paid creditors on account, $4,500. 8. Received cash from customers on account, $36,200. 9. Dete...

From the following list of selected items taken from the records of Hoosier Appliance Service as of a specific date, identify those that would appear on the balance sheet: 1. Accounts Receivable 2. Cash 3. Fees Earned 4. Land 5. Ming Hu, Capital 6. Supplies 7. Supplies Expense 8. Utilities Expense 9. Wages Expense 10. Wages Payable

A summary of cash flows for Ethos Consulting Group for the year ended May 31, 2014, is shown below. The cash balance as of June 1, 2013, was $58,000. Prepare a statement of cash flows for Ethos Consulting Group for the year ended May 31, 2014.