Use this information for the following three questions. KW Steel Corp. uses the LIFO method of...

Use this information for the following three questions.

KW Steel Corp. uses the LIFO method of inventory valuation. Waretown Steel, KW’s major competitor, instead uses the FIFO method. The following are excerpts from each company’s 2014 and 2013 financial statements:

	KW Steel Corp.		Waretown Steel
($ in millions)	2014	2013	2014	2013
Balance sheet inventories	797.6	692.7	708.2	688.6
LIFO reserve	378.0	334.9

Sales	4,284.8	4,029.7	3,584.2	3,355.8
Cost of goods sold	3,427.8	3,226.5	2,724.0	2,617.5

Use this information for the following three questions.

KW Steel Corp. uses the LIFO method of inventory valuation. Waretown Steel, KW’s major competitor, instead uses the FIFO method. The following are excerpts from each company’s 2014 and 2013 financial statements:

	KW Steel Corp.		Waretown Steel
($ in millions)	2014	2013	2014	2013
Balance sheet inventories	797.6	692.7	708.2	688.6
LIFO reserve	378.0	334.9

Sales	4,284.8	4,029.7	3,584.2	3,355.8
Cost of goods sold	3,427.8	3,226.5	2,724.0	2,617.5

Calculate inventory turnover for KW Steel in 2014.

Calculate inventory turnover for Waretown Steel in 2014.

Re-calculate KW Steel's inventory turnover in 2014 if they used FIFO.

Expert Solution

Answer question

ekkarill92 answered 1 year ago

Use the following information to answer the following three questions: On July 1, 2019, Jones Corp....

Use the following information to answer the following three questions: On July 1, 2019, Jones Corp. issued $40,000 face value, 10-year, 8% coupon bonds paying interest semiannually on June 30th and Dec 31st. The market (yield) rate on the date of issuance was 10%. The present value factor for an annuity is 12.462 and the present value factor of a lump sum is 0.377 1. Record the journal entry made when the bonds were issued on July 1st, 2019? 2. ...

Use the following information to answer the following three questions: On July 1, 2003, Jones Corp....

Use the following information to answer the following three questions: On July 1, 2003, Jones Corp. issued $100,000 face value, 10-year, 6% coupon bonds paying interest semiannually on June 30th and Dec 31st. The market (yield) rate on the date of issuance was 12%. The company’s fiscal year end is Dec. 31st. The cash received on July 1, 2003 when the issuance occurred was $65,610. 1. Which of the following journal entries were made when the bonds were issued on...

Kayla Company uses the perpetual inventory system and the LIFO method. The following information is available...

Kayla Company uses the perpetual inventory system and the LIFO method. The following information is available for the month of June: June 1 Beginning inventory 200 units @ $5 12 Purchase on account 400 units @ $6 15 Sales on account 440 units 23 Purchase on account 300 units @ $7 27 Sales on account 360 units The selling price (price the company charged the customers) was $10 per unit. a) Show the calculation of cost of goods sold and...

The following information is available for Wallace Company for 2017. Wallace uses the LIFO inventory method....

The following information is available for Wallace Company for 2017. Wallace uses the LIFO inventory method. Beginning inventory $600,000 Ending inventory 700,000 Beginning LIFO reserve 200,000 Ending LIFO reserve 300,000 Cost of goods sold 5,980,000 Sales 8,000,000 Calculate the inventory turnover and days in inventory for Wallace Company based on LIFO. (Round answers to 1 decimal places, e.g. 15.2.) Inventory turnover ____ times Days in inventory ____ days. Calculate the inventory turnover and days in inventory after adjusting for the...

Umbrella Corp uses LIFO method to report inventory. Inventory at the beginning of the year consisted...

Umbrella Corp uses LIFO method to report inventory. Inventory at the beginning of the year consisted of 10,000 units of the company's one product for $15 each. During the year: 60,000 units were purchased at the cost of $18 each. 64,000 units were sold. Near the end of the fiscal year, management is considering purchasing an additional 5,000 units at $18. What would the effect of this purchase be on income before taxes? Would the answer be the same if...

Question 1: Kayla Company uses the perpetual inventory system and the LIFO method. The following information...

Question 1: Kayla Company uses the perpetual inventory system and the LIFO method. The following information is available for the month of June: June 1 Beginning inventory 200 units @ $5 12 Purchase on account 400 units @ $6 15 Sales on account 440 units 23 Purchase on account 300 units @ $7 27 Sales on account 360 units The selling price (price the company charged the customers) was $10 per unit. a) Show the calculation of cost of goods...

Use the following information to answer questions #54-55 Your business uses the allowance method to account...

Use the following information to answer questions #54-55 Your business uses the allowance method to account for uncollectible receivables. At the beginning of the year, the balance in accounts receivable was $10,000 and the balance in the allowance for doubtful accounts (AFDA) was $1,800. During the year the business had sales on account of $25,000 and wrote off a $2,000 uncollectible account. The company estimates that 7% of their receivables won’t be collectible. 54. What is the uncollectible accounts (bad...

SPK Industries uses the LIFO inventory costing system, use the following information to calculate the COGS...

SPK Industries uses the LIFO inventory costing system, use the following information to calculate the COGS if they sold 50 units in July. Date Purchases Price per Unit 6/15 30 units $120 6/30 40 units $130 7/15 20 units $150

You have the following information for Sheffield Corp.. Sheffield uses the periodic method of accounting for...

You have the following information for Sheffield Corp.. Sheffield uses the periodic method of accounting for its inventory transactions. Sheffield only carries one brand and size of diamonds—all are identical. Each batch of diamonds purchased is carefully coded and marked with its purchase cost. March 1 Beginning inventory 141 diamonds at a cost of $285 per diamond. March 3 Purchased 207 diamonds at a cost of $365 each. March 5 Sold 166 diamonds for $570 each. March 10 Purchased 328...

Use the following information to answer the next three questions: The following information is available from...

Use the following information to answer the next three questions: The following information is available from the records of Aggies R Us, Inc. at the end of the 2017 calendar year. Assume this is Aggies’ 1st year of operation. Accounts Receivable $102,200 Notes Payable $???? Cash 70,890 Salary Expense 320,000 Building 75,000 Retained earnings ???? Advertising Expense 60,000 Accounts Payable 62,800 Dividends 12,200 Income Tax Expense 23,100 Service Revenues 460,000 Common Stock 120,000 Office Equipment 22,500 Wages Payable 15,450 Determine Aggies’ Net Income for the year ended December 31, 2017: A. $36,900 B. $80,000 C. $56,900 D. $44,700...

Question