Recent Question/Assignment

Task 1
Part A
You are a newly recruited trainee Bookkeeper for Globe Accounting Services. You are given the task of processing the inventory purchases of one of the clients ‘Fashion Clothing Company’.
Q1.
Q2.
Q3.
Red Shirts
Date Ref Debit
Credit Balance

Black Trousers
Date Ref
Debit Credit Balance

White Shirts
Date Ref Debit
Credit Balance

Black Belts
Date Ref Debit
Credit Balance

Blue Shirts
Date Ref Debit Credit Balance

Black T- Shirts
Date Ref Debit Credit Balance

Q4.
PART B
Cost of goods sold (COGS)
Inventory shortage or loss of inventory?
• Prepare journal entries for both perpetual and period inventory record systems
Perpetual Inventory record systems
Date
Details Debit Credit

Periodic Inventory record systems
Date Details
Debit Credit

• General ledger accounts for Inventory and Accounts receivable in the perpetual inventory system
Inventory
Date
Ref Debit Credit Balance

Accounts receivable
Date Ref Debit
Credit Balance

• Show the gross profit calculation for both perpetual and period inventory record systems
Gross profit calculation for perpetual inventory
Gross profit calculation for periodic inventory
PART C
Scenario 1
Estimate the cost of a company's inventory as at June 30 based on gross margin.
Scenario 2
Calculate the net realizable value
Item Code Units Unit Cost Total Cost Units Market Price Total Market Price Lowe of Cost or Market
Write the journal entry to record the net realizable value of the total inventory
Details Debit Credit

Scenario 3
1. Advice the client what is the applicable Australian Accounting standard for inventory valuation?
2. What inventory valuation methods / rules are allowed under the Australian standards?
3. Calculate the value of inventory using:

a)
- FIFO – Perpetual
Date
Details
Purchases

Cost of goods sold
Balance
Units Unit Price ($) Total ($) Units Unit Price ($) Total ($) Units Unit Price ($) Total ($)

- FIFO Periodic
b) Weighted Average – Periodic
Part D
a)
Date
Particulars
Debit
Credit

b)
Date
Particulars
Debit
Credit

Part E
a) How to calculate inventory turnover
b) Develop a schedule of inventory turnover and present it using MS Word or Excel spreadsheet
c) Prepare an inventory status report using MS Word or Excel spreadsheet
Task 2
1. Outline organizational procedures/practices and accounting principles relevant to maintaining inventory records.
2. Describe the key steps in the process of inventory management and any relevant documentation/recording systems.
3.Identify and explain the process for entering data into systems/ledgers.
4. Explain the key features of inventory valuation rules and reconciliation processes.
5. Provide 3 methods that are included in the inventory flow assumptions?
6. What is the equation, which expresses how a company's inventory is valued?
7. Briefly explain the purpose of inventory management and reconciliation.
8. What does the term discrepancy refer to in relation to maintaining inventory?
References:
R. Arnolda (2021), ‘FNSACC405 Maintain inventory records’, PowerPoint slides S1, v3.0.
R. Arnolda (2021), ‘FNSACC405 Maintain inventory records’, Online Session1, 31st March 2021.
R. Arnolda (2021), ‘FNSACC405 Maintain inventory records’, PowerPoint slides S2, v3.0.
R. Arnolda (2021), ‘FNSACC405 Maintain inventory records’, Online Session2, 7th April 2021.
Arnolda, R. (2021), ‘FNSACC405 Maintain inventory records Student Handout, version 3.0.

Looking for answers ?