CHAPTER 6 Reporting and Analyzing Inventory Study Objectives 1. Describe the steps in determining inventory quantities. 2. Explain the basis of accounting for inventories and apply the inventory cost flow methods under a periodic inventory system. 3. Explain the financial statement and tax effects of each of the inventory cost flow assumptions. 4. Explain the lower of cost or market basis of accounting for inventories. 5. Compute and interpret the inventory turnover ratio. 6. Describe the
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The Franklin Corporation last year reported sales of $10 million and an inventory turnover ratio of 2. The company has acquired a new inventory control system. If the new system is able to reduce the firm's inventory level and increase the firm's inventory turnover ratio to 5, and still maintain the sales level, how much additional cash will they have? The Myst Association has an average collection period of 17 days for credit sales and averages $3,500 per day in credit sales. What are the company's
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FINANCIAL STATEMENTS FOR THE COCA-COLA COMPANY Financial Statements for the Coca-Cola Company For the fiscal year ended December 31, 2011 ITEM 1. BUSINESS General The Coca‑Cola Company operates in more than 200 countries and markets more than 500 brands and 3,500 beverage products. These products include sparkling and still beverages, such as waters, juices and juice drinks, teas, coffees, sports drinks and energy drinks. They have four of the world’s top five nonalcoholic sparkling beverage
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Letter Head Delivery 10 Days 5 months New Item Implementation Immediately Common Split Deliveries Much Less Common 42 Area Sites Site Service All Sites $900,000 Annual Throughput *$846,000 $200,000 Space Personnel Costs 0 $140,000 Inventory Management 0 4 Employees 0 *Note: This is based on same level of throughput with 6% savings Stake Holders Impact The stake holders that are
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projects D) become more risky over time E) accept profitable, low risk projects 2. Delta, Inc. follows a flexible short-term financing policy. The firm produces educational toys, which is a cyclical business. When the firm needs to pay for large inventories in advance of peak sales, the firm will: A) Sell marketable securities. B) Negotiate a bankers acceptance. C) Arrange for a field warehouse loan. D) Issue a trust receipt to the bank in exchange for funding. E) Issue commercial paper with a maturity
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PRODUCTION PLANNING AND CONTROL Assignment A Marks 10 Answer all questions. 1. a) Explain the forecasting process? What are the techniques for monitoring forecasts? b) Explain various forecasting models. a) A planning tool that helps management in its attempts to cope with the uncertainty of the future, relying mainly on data from the past and present and analysis of trends. Forecasting starts with certain assumptions based
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Executive Summary Fantastic Florals, Inc. (FFI) imports exclusively handmade flowers by artisans from Indonesia. The firm's main office is in Anytown, Oregon, and has a customs house broker in Seattle, Washington to deal with related matters. FFI quality products are unique and exclusive, and its target consumers are women with upper-middle to upper-end incomes. FFI's competitive edge is that the products are 100% handmade, unlike competitor's products. By this fact, the firm hopes to attract people
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Finanacial accounting assignement. Q2. Explain the meaning and importance of cash flow statement and funds flow statement. Also explain the difference between cash flow statement and funds flow statement. Ans.2. Fund flow statement is referred as sources and application of funds. It helps in showing detailed revenue received from sources and the amount of money used by the business for many purposes in that Financial Year. This statement provides addition information which is not generally covered
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component of balancing supply in order to meet customer needs while ensuring costs are kept low. Without proper forecasting, companies can see a direct hit to their bottom line by keeping too much inventory resulting in capacity issues, as well as by losing customers due to not having enough inventory. In the case of Yankee Fork and Hoe Company there are several issues with the forecasting system used in each department and these issues need to be rectified in order to improve cross-functionality
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The importance of inventory management evidenced by retail sales and inventory increases US retail sales increased 1.1% in February after increasing 0.4% in January. Sales of automobiles and parts as well as gasoline helped push retail sales to its largest gain since September 2011. The increase in retail sales was preceded by an increase in inventories for the month of January. The growing confidence in an improving economy has resulted in an inventory increase of 0.7% and a 1.1% increase
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