NVCC Accounting Inventory and Depreciation analysis Fall 2015 Instructions: Use the numbers below for each PART (A, B etc) and Step (1,2 etc). Add numbers into the cells and answer any questions asked in each of the "call out" boxes

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NVCC Accounting Inventory and Depreciation analysisFall 2015 
Instructions: Use the numbers below for each PART (A, B etc) and Step (1,2 etc).  Add numbers into the cells and answer 
      any questions asked in each of the "call out" boxes. 
         
NUMBERS PROVIDED (See Instructions and use for Part A Income Statement)    
         
Sales price $700.00 Revenue for 2014 Step 1  
Quantity (Units) sold in 201412,000       
         
Units carried over from 20134,000 Cost of Existing inventoryStep 2  
Price per unit of inventory carried over$45.00       
         
Units purchased for each monthly purchase500    Step 3  
Purchase price of Jan 1 units$110.00       
Purchase price for Jan 15 units$115.00       
Purchase price for Feb 1 units$120.00 Used to complete the Inventory carryover  
Purchase price for Feb 15 units$125.00  and purchases table    
Purchase price for Mar 1 units$130.00       
Purchase price for Mar 15 units$135.00       
Purchase price for Apr 1 units$140.00       
Purchase price for Apr 15 units$145.00       
Purchase price for May 1 units$150.00       
Purchase price for May 15 units$155.00       
Purchase price for Jun 1 units$160.00       
Purchase price for Jun 15 units$165.00       
Purchase price for July 1 units$170.00       
Purchase price for July 15 units$175.00       
Purchase price for Aug 1 units$180.00       
Purchase price for Aug 15 units$185.00       
Purchase price for Sept 1 units$190.00       
Purchase price for Sept 15 units$195.00       
Purchase price for Oct 1 units$200.00       
Purchase price for Oct 15 units$205.00       
Purchase price for Nov 1 units$210.00       
Purchase price for Nov 15 units$215.00       
Purchase price for Dec 1 units$220.00       
Purchase price for Dec 15 units$225.00       
         
For Part A - steps 4, 5, 6 and 7 use the data supplied above.   
  
         
         
See Instuctions for Step 8 in Part B Balance Sheet       
         
See Instuctions for Step 9 in Part C Depreciation       
         
See Instuctions for Step 10 in Part D Break Even point analysis     
         

After completing the 10 steps you are done. Email this Excel back to me.   Dr. Dantonio

 

 

 

Periodic Inventory project       
Instructions: Complete this project by using the numbers provided.
 Question : What effect does the Inventory method have on the net  
     Follow the steps (do not alter the 3 Income statements below)                           Income, EPS, taxes and Remaining Inventory?  
Go to Step 1 - Calculate the revenue (note change on income statement) Answer:  
For Step 2 - Calculate the cost in Dollars and value of existing Inventory   
        for the "carried from 2013" inventory.   
For Step 3 - Calculate the cost in dollars and value of existing Inventory   
        for each purchase using the price for that date.   
For Step 4 - Enter units sold for each method (they are the same)   
For Step 5 - Use the completed Inventory Carryover and Purchases    
       Table to calculate the COGS using FIFO and LIFO.   
For Step 6 - Use the completed Inventory Carryover and Purchases  
 
     
       Table to calculate the average cost and the COGS using AVERAGE.       
For Step 7 - Calculate the value of the remaining Inventory.       
           
       2014   
       Revenue   
           
                            Tech Master IncFIFO        
                             Income Statement         
                 For year ended 31 December 2014         
           
Revenue          
     Cost of Goods Sold          
Gross Margin#VALUE!         
     Depreciation Expense $300,000.00        
     Salaries Expense $1,200,000.00        
     Interest Expense $4,000.00        
     Advertising Expense $75.00        
     Total Operating Expenses$1,504,075.00         
Earnings before Income tax#VALUE!         
     Tax#VALUE!         
Net Income#VALUE!         
           
EPS =#VALUE!    Inventory carryover and Purchases Table
      
      DateUnits Purchase Cost in Value of total
Tech Master IncLIFO    Purchased/carryoverPriceDollarsInventory
                             Income Statement    Carried From 20134000$45.00  
                 For year ended 31 December 2014    1-Jan500   
      15-Jan500   
Revenue     1-Feb500   
     Cost of Goods Sold     15-Feb500   
Gross Margin#VALUE!    1-Mar500   
     Depreciation Expense $300,000.00   15-Mar500   
     Salaries Expense $1,200,000.00   1-Apr500   
     Interest Expense $4,000.00   15-Apr500   
     Advertising Expense $75.00   1-May500   
     Total Operating Expenses$1,504,075.00    15-May500   
Earnings before Income tax#VALUE!    1-Jun500   
     Tax#VALUE!    15-Jun500   
Net Income#VALUE!    1-Jul500   
      15-Jul500   
EPS=#VALUE!    1-Aug500   
      15-Aug500   
      1-Sep500   
      15-Sep500   
Tech Master IncAVERAGE   1-Oct500   
                             Income Statement     15-Oct500   
                 For year ended 31 December 2014    1-Nov500   
      15-Nov500   
Revenue     1-Dec500   
     Cost of Goods Sold     15-Dec500   
Gross Margin#VALUE!         
     Depreciation Expense $300,000.00        
     Salaries Expense $1,200,000.00        
     Interest Expense $4,000.00        
     Advertising Expense $75.00   Total Units Goods   
     Total Operating Expenses$1,504,075.00    Available for available   
Earnings before Income tax#VALUE!    Sale for sale  
     Tax#VALUE!         
Net Income#VALUE!         
           
EPS=#VALUE!         
           

 

 

 

 

 

 

           
                Tech Master Inc.    FIFO       
         
             As of 31 Dec 2014         
           
 
Current Liabilities:         
 Accounts Payable4,590.00        
      Total Current Liabilities4,590.00        
           
2,777,793.25          
           
           
 Notes Payable4,000.00        
      Total Liabilities 8,590.00       
           
 Shareholders' Equity         
8,336.00Common stock10,000.00        
 Retained Earnings0.00        
812.00      Total shareholders' equity  10,000.00  Question : What effect does the Inventory method have on the three
                                Balance sheets here?
      Answer: 
       
$2,786,941.25Total Liab and Shareholders' Equity $18,590.00   
       
       
       
       
                Tech Master Inc.    LIFO   
         
             As of 31 Dec 2014         
           
 Current Liabilities:         
 Accounts Payable4,590.00        
      Total Current Liabilities4,590.00        
           
3,005,293.25          
           
           
 Notes Payable4,000.00        
      Total Liabilities 8,590.00       
           
 Shareholders' Equity         
8,336.00Common stock10,000.00        
 Retained Earnings0.00        
812.00      Total shareholders' equity  10,000.00       
            
           
           
$3,014,441.25Total Liab and Shareholders' Equity $18,590.00       
           
           
           
           
                Tech Master Inc.    AVERAGE       
         
             As of 31 Dec 2014         
           
 Current Liabilities:         
 Accounts Payable4,590.00        
      Total Current Liabilities4,590.00        
           
2,876,668.25          
           
           
 Notes Payable4,000.00        
      Total Liabilities 8,590.00       
           
 Shareholders' Equity         
8,336.00Common stock10,000.00        
 Retained Earnings0.00        
812.00      Total shareholders' equity  10,000.00       
            
           
           
$2,885,816.25Total Liab and Shareholders' Equity $18,590.00       
           
 
       
        
   Depreciation Method Analysis 
   Instructions: Complete this chart by using a starting value of $3,000,000. 
   Salvage value is $400,000 and asset will last 20 years.  
   Calculate the Straight line and Declining Balance method for each year. 
        
        
Tech Master  Inc.
Declining Balance methodStraight line depreciation
YearStart yearDepreciationEnd YearYearStart yearDepreciationEnd Year
1$3,000,000.00  1$3,000,000.00 #VALUE!
2   2   
3   3   
4   4   
5   5   
6   6   
7   7   
8   8   
9   9   
10   10   
11   11   
12   12   
13   13   
14   14   
15   15   
16   16   
17   17   
18   18   
19   19   
20   20   
        
        
        
 Question : What effect does the Depreciation Method have on the Depreciation Expense   
                          and the value of the asset and accumulated Depreciation?  
 Answer:   
    
    
    
    
    
    
    
        
        
 Question : What effect would the Depreciation Method have the Net Income of this   
                         Firm in year 10?   
 Answer:   
    
    
    
    
    
    
    
        
          

 

       BEP = FC / (Sales price - variable cost)      
  (BEP) Break Even Point analysis FC = Fixed cost        
  Instructions: Complete this project by using BEP formula    TC = FC + (VC X # of units) VC = Variable cost   Question : What is the break even point for each option? 
       Fill out the chart below and answer the question under the chart. Units = the number sold    
  Fixed costs Option A  = 3,000,000, option B = 0 and Option C = 600,000 TC = Total cost   Answer:  
  Variable costs Option A = $55, Option B = $255, Option C = $155       
  
Start units with 100 then add 100 for each line (eg. 100, 200, 300 etc to 30,000 units)
       
  Sales price = $ 500       
             
 UnitsOption AOption BOption C        
 100           
 200           
 300               
 400               
 500         Question : What is the lowest total cost option for 5800 units? 6000 units?  
 600                             How about 23,500 units and 24,500 units? 
 700         Answer:  
 800           
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  • 7 years ago
NVCC Accounting Inventory and Depreciation analysis Fall 2015 Instructions: Use the numbers below for each PART (A, B etc) and Step (1,2 etc). Add numbers into the cells and answer any questions asked in each of the "call out" boxes
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