Intermediate Accounting ( 16e) Home Read, Study & Practice Gradebook ORION Downl

Question

Intermediate Accounting ( 16e) Home Read, Study & Practice Gradebook ORION Downloadable elextbook Assignment > Open Assignment MISSAGE HY INSTRUCTOR FULL SCREEN Problem 9-11 Pharoah Specialty Company, a division of Lost World Inc., manufactures three models of gear shift components for bicycles that are sold to bicycle manufacturers, retailers, and catalog outlets. Since beginning operations in 1993, Pharoah has used normal absorption costing and has assumed a first-in, first-out cost flow in its perpetual inventory system. The baiances of the inventory accounts at the end of Pharoah's fiscal year, November 30, 2017, are shown below. The inventories are stated at cost before any year end adjustments. Finished goods Work in process Raw materials $662,900 105,800 283,500 71,200 Factory supplies The following information relates to Pharoah's inventory and operations. 1. The finished goods inventory consists of the items analyzed below. Cost NRV Down tube shifter Standard model Click adjustment mode Deluxe model $69,700 92,800 118,000 280,500 $69,100 80,100 120,100 269,300 Total down tube shifters Bar end shifter Standard model Click adjustment model 98,700 103,300 84,400 104,800 201 PM 4/26/20 O Type here to search

Explanation / Answer

workings:

*$283500/2=$141750 ; $141,750/120%=$118,125

**$71,200-$4,500=$66,700

ANSWER:

THE INVENTORY SECTION OF PHAROAH SPECIALITY COMPANY , INCLUDIING FOOTNOTES IS PRESENTED BELOW:

NOTE 1) LOWER OF COST OR NRV IS APPLIED ON A MAJOR CATEGORY BASIS FOR FINISHED GOODS , AND TOTAL INVENTORY BASIS FOR WORK-IN-PROCESS , RAW MATERIALS, FACTORY SUPPLIES.

NOTE 2)75%(3 QUARTERS) OF BAR END SHIFTERS FINISHED GOODS INVENTORY IN THE AMOUNT OF $141,900($189,200 * 75%) IS PLEDGED AS COLLATERAL TO BANK FOR LOAN AND ONE HALF OF HEAD TUBE SHIFTERS FINISHED GOODS IS HELD BY CATLOG OUTLETS ON CONSIGNMENT

Finished Goods Work In process Raw Materials Factory Supplies Down tube shifter At NRV $269,300 BEAR end shifter at cost $189,200 Head Tube Shifter at cost $662,900 WIP at NRV $103,600 Derallieurs at Market $118,125* Remaining items at NRV $123,500 Supplies at cost $66,700** Totals $1,121,400 $103,600 $241,625 $66,700

Related Questions

Navigate

• Browse (All)
• Browse I
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.