Case One

Case 1. Assume you be opening a razz in Bath & Beyond store. To finance the business, you need a $500,000 loan, and your banker requires a set of forecasted financial statements. Assume you ar preparing the statements and moldiness knead some decisions about how to do the ac reckoninging for the business. outcome the spare-time activity questions (refer back to Chapter 5 if necessary): 1. Which type of memorandum trunk get out you use? Give your reason. I conduct use the constant bloodline system because it keep ons a path record of inventory and cost of goods sold and achieves control everywhere inventory. 2. Show how to write in code lowest purchases and can sales. How depart you treat the cost of transportation-in? sales Revenue ? sales Returns and Allowances ?Sales Discounts = Net Sales Revenue memorandum obtain Returns and Allowances Purchase Discounts + Freight in = Inventory (Net address of Inventory) Since I will turn over freight in, the cost of transportation-in will be added to the purchases of inventory. 3. How often do you plan to do a personal count of inventory on muckle? What will the personal count accomplish? I plan to do a physical count of inventory on hand at least once a year.

The physical count should keep inventory current and allow any adjustments to be do based on count. 4. Inventory costs are rising. Which inventory costing method will you use in set up to: a. Maximize net income? I will habituate FIFO. When prices are rising, that means that erstwhile(a) items cost less. FIFO assigns older items to C OGS, making net income higher b. Pay the ! least amount of income assess? last in first out results in the highest cost of goods sold and the lowest coarse profit. That lets companies pay the lowest income levyes when inventory costs are rising. minuscule tax payments conserve cash and thats the main reach of LIFO.If you compliments to get a full essay, order it on our website: OrderCustomPaper.com

If you want to get a full essay, visit our page: write my paper