BUS3061 Fundamentals of Accounting Student’s name: Institutional affiliation: Answer 1 Proficient In this case when a corporation has proper inventory valuation there will be accuracy in elements such as gross profit and cost of goods sold. In addition current assets and working capital will be on point. Inaccuracies will create erroneous reporting of figures in the balance sheet as well as the income statement. It is the act of comparing the actual physical stock against the records held within the accounting books CITATION Her11 \l 1033 (Hermanson Edwards & Maher 2011). It is essential in promoting business integrity hence reputation and customer satisfaction are realized in the long run. Distinguished During the activity accountants have roles in planning and coordinating it. They draft proper forms to take the the calculation. If it is high it indicates efficiency in inventory management. When low it indicates that most funds are held within inventory. Distinguished Average inventory for 2014 = ($283 000 + $264 000)/2 = $273 500 Inventory turnover for 2014 = $1 043 000/ $273 500 = 3.81 times Average inventory for 2013 = ($311 000 + $283 000)/2 = $297 000 Inventory turnover for 2013 = $820 000/ $297 000 = 2.76 times In terms of trend the figure was higher in 2014 as opposed to 2013. This implies that the company had a better inventory management in 2014 since funds were less tied up in inventory. Reference BIBLIOGRAPHY Hermanson Edwards & Maher. (2011). Accounting Principles: A Business Perspective Financial Accounting. Homewood IL: Richard D Irwin. [...]
BUS3061 Fundamentals of Accounting PART 5 DUE DATE FOR SECTION 1, 2, AND 4 IS ON FEB 13, 2018 EXCEPT FOR SECTION #3 THE FINAL QUIZ IS DUE TODAY JAN 31, 2018. SECTION # 1 AND 2 HAVE AN OPTION, YOU CAN DO BOTH OR YOU CAN CHOSE OPTION ONE OR OPTION TWO. THAT ALSO MEANS THE RESPONE GUIDELINES ARE DIFFERENT IT DEPEND ON THE OPTION CHOSEN. THE FINAL QUIZ WILL BE PUT IN A SEPARATE DOCUMENT FOR THE ANSWERS. Section-#1[-u05d1u05d1] Unit 5 Discussion 1 U05d1 The Wall Street Journal Article Review, or Periodic or Perpetual, Choose Wisely For the Unit 5 Discussion, you have the option of responding to one of two topics, either Option 1: The Wall Street Journal Article Review, or Option 2: Periodic or Perpetual, Choose Wisely. Option 1: The Wall Street Journal Article Review Review the Discussion Participation Scoring Guide. We are now at the end of the course of the fundamentals of accounting. For this discussion topic, you are to select and address one of the topics covered in this course as it relates to an article found in The Wall Street Journal. Capella has secured full online access for you to The Wall Street Journal. This daily newspaper provides coverage of headlines and breaking news in the United States and around the world, with a focus on business issues that are pertinent to you. Review an article of your choosing from The Wall Street Journal and address the following: • Access The Wall Street Journal (WSJ). Directions for signing up to WSJ are included in the Courseroom in the "Getting Started" tab. • Select an article of your choosing from the WSJ. The article should relate to the financial performance of a company, or any other topic that we have covered in this course on the fundamentals of accounting. In each daily publication, there will be numerous examples from which to choose. • Provide the title and date of the article you have selected. • Briefly, list and provide definitions of the various terms and concepts we have studied that you found in the article. A minimum of three definitions should be found. • Your discussion post is not required to be of significant length, as there is value in your demonstration of having accessed The Wall Street Journal evidenced by your having matched several theoretical definitions and concepts to actual business occurrences. Section-#2 U05d1 Response Guidelines Read the initial posts of your peers and respond to two. In your responses, compare your post with that of your peer's post. Note the differences you see and explain if you agree or disagree with you peer's analysis. Explain. Section-#1 Option 2: Periodic or Perpetual, Choose Wisely U05d1- Review the Discussion Participation Scoring Guide. Cripple Creek Hardware Store currently uses a periodic inventory system. Hoyt Braxton, the owner, is considering the purchase of a computer system that would make it feasible to switch to a perpetual inventory system. Hoyt is unhappy with the periodic system because it does not provide timely information on inventory levels. Hoyt has noticed on several occasions that the store runs out of good-selling items, while too many poor-selling are on hand. Hoyt is also concerned about lost sales while a physical inventory is being taken. The store currently takes a physical inventory twice a year. To minimize distractions, the store is closed on the day inventory is taken. Hoyt believes that closing the store is the only way to get an accurate count. You have been brought in to assess the situation and provide expert advice on which course of action to take—remain with the current periodic inventory system or switch to a perpetual inventory system. Present your findings to Hoyt, discussing whether switching to a perpetual inventory system will strengthen Cripple Creek Hardware's control over inventory items and eliminate the need for a physical inventory count. Section-#2 U05d1-Response guidelines Response Guidelines From the perspective of Hoyt, the store owner, respond to the posts of at least two of your fellow learners with questions or issues they did not address in their original discussion. • Critically evaluate the soundness of the advice that was given to you. • Identify other issues that might not have been considered. Post your responses by midnight on Sunday of this week. Resources • Discussion Participation Scoring Guide. • The Wall Street Journal. Uo5q1-section-#3 Section-#3-see u05q1 document for questions too quiz Final Quiz Introduction Now that you have completed the course, it is time to take this multiple-choice quiz, which gauges your understanding of the material presented in Units 1 through 5 and provides an opportunity for you to demonstrate your mastery of the following course competencies: • Define accounting terminology and its application to accounting principles. • Apply accounting cycle strategies to manage business financial events. • Prepare financial statements from accounting system data. Instructions Read the following instructions before taking the quiz: • There is no time limit on the quiz. • You must take and submit the quiz in this unit. • After answering each question, submit your quiz to receive credit. The quiz is scored automatically, and you will receive feedback immediately. There are 100 total points possible. Each question is worth four points. • You may access the quiz to view the questions. However, you cannot retake the quiz to change your grade. Once the grade is recorded, it cannot be changed. • Because you are able to take the quiz only once, do not access the quiz until you are ready to complete it. • When you access the quiz, read the Instructions and Troubleshooting page before you begin. To start the quiz: 19. Click the linked quiz title to access the quiz. 20. If you have any issues with the quiz, contact your instructor. Section-#4-u05a1 U05a1 [u05a1] Unit 5 Assignment 1 Ratio Analysis This assignment will familiarize you with cost flow assumptions and inventory valuation. After completing this assignment, you will understand: • The value of proper merchandise inventory valuation for an organization's financials. • The concept of the physical flow of goods. • The most commonly used inventory valuation methods. • The effects of the economy on the choice of inventory valuation method used. • How to use alternative historical cost methods for valuing merchandise inventory. • How to use the inventory turnover ratio as a tool for financial analysis. Instructions Respond to the following questions or problems using grammatically correct language and appropriate APA citations. To achieve a proficient grade in this assignment, answer the proficient-level queries for each question. To achieve a distinguished grade, answer both sets of queries for each question. 1. Question 1: o Proficient: o Explain why proper inventory valuation is so important to the calculation of a company's "bottom line" net income. o What is the meaning of taking a physical inventory and why is it important to take a physical inventory when using a perpetual inventory system. o Distinguished: o Explain the accountant's role regarding taking a physical inventory. 2. Question 2: o Proficient: o What is the cost flow assumption? o What is meant by the physical flow of goods? o What relationship exists between cost flows and the physical flow of goods in a company? o Distinguished: o To place the proper valuation on inventory, a business must determine which costs should be included in inventory cost. Getting goods ready to sell should include what items? 3. Question 3: o Proficient: o Identify and describe each of the four most commonly used inventory valuation methods. What are the main advantages of each method? o Distinguished: o Identify the main disadvantages of each inventory valuation method. 4. Question 4: o Proficient: o If inventory is being valued at cost and the price level is steadily rising, which of the following three methods of costing—FIFO, LIFO, or weighted average cost—will yield the lowest annual after tax net income? o Which method will yield the highest after tax net income in a scenario where the price level is steadily declining? o Distinguished: o Which of the three methods of inventory will in general yield an inventory cost most nearly approximating current replacement cost? 5. Question 5: o Proficient: o Some circumstances justify departures from the historical cost approaches of FIFO, LIFO, and weighted average cost. Several additional inventory methods may be used when circumstances warrant. Identify and describe each of these alternative methods. Include an example of when each method may be applied. o Distinguished: o Identify which methods could be used to determine whether there has been shrinkage or shortage in the physical inventory. 6. Question 6: o Proficient: o Identify and describe the ratio that can be used to analyze a company's inventory. o What does the ratio measure? What are the components of the ratio? How is the ratio computed? o How does a company know if the results of the calculation are helping or hurting the company's financial health? o Distinguished: o Given the following information, calculate the inventory turnover for Lincoln Company, a large grocery store chain. Evaluate the trend results. 2014: Cost of goods sold—$1,043,000; Beginning inventory—$283,000; Ending inventory—$264,000. 2013: Cost of goods sold—$820,000; Beginning inventory—$311,000; Ending inventory—$283,000. Write your responses in a Microsoft Word document and submit it as an attachment in the assignment area. Prior to submitting your assignment, review the Ratio Analysis Scoring Guide to ensure you have met all of the requirements and as a self-assessment of your work. Be sure to address the questions at the proficient and distinguished levels to achieve the highest grade possible. Note: Your instructor may also use the Writing Feedback Tool to provide feedback on your writing. In the tool, click the linked resources for helpful writing information. Resources • Ratio Analysis Scoring Guide.