September 2023 NVCC Accounting Inventory and Depreciation analysis
September 2023 Business Finance Assignment
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.
NUMBERS PROVIDED (See Instructions and use for Part A Income Statement)
Sales price $700.00 Revenue for 2014 Step 1
Quantity (Units) sold in 2014 12,000
Units carried over from 2013 4,000 Cost of Existing inventory Step 2
Price per unit of inventory carried over $45.00
Units purchased for each monthly purchase 500 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 Inc FIFO
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
Date Units Purchase Cost in Value of total
Tech Master Inc LIFO Purchased/carryover Price Dollars Inventory
Income Statement Carried From 2013 4000 $45.00
For year ended 31 December 2014 1-Jan 500
15-Jan 500
Revenue 1-Feb 500
Cost of Goods Sold 15-Feb 500
Gross Margin #VALUE! 1-Mar 500
Depreciation Expense $300,000.00 15-Mar 500
Salaries Expense $1,200,000.00 1-Apr 500
Interest Expense $4,000.00 15-Apr 500
Advertising Expense $75.00 1-May 500
Total Operating Expenses $1,504,075.00 15-May 500
Earnings before Income tax #VALUE! 1-Jun 500
Tax #VALUE! 15-Jun 500
Net Income #VALUE! 1-Jul 500
15-Jul 500
EPS= #VALUE! 1-Aug 500
15-Aug 500
1-Sep 500
15-Sep 500
Tech Master Inc AVERAGE 1-Oct 500
Income Statement 15-Oct 500
For year ended 31 December 2014 1-Nov 500
15-Nov 500
Revenue 1-Dec 500
Cost of Goods Sold 15-Dec 500
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 Payable 4,590.00
Total Current Liabilities 4,590.00
2,777,793.25
Notes Payable 4,000.00
Total Liabilities 8,590.00
Shareholders’ Equity
8,336.00 Common stock 10,000.00
Retained Earnings 0.00
812.00 Total shareholders’ equity 10,000.00
$2,786,941.25 Total Liab and Shareholders’ Equity $18,590.00
Tech Master Inc. LIFO
As of 31 Dec 2014
Current Liabilities:
Accounts Payable 4,590.00
Total Current Liabilities 4,590.00
3,005,293.25
Notes Payable 4,000.00
Total Liabilities 8,590.00
Shareholders’ Equity
8,336.00 Common stock 10,000.00
Retained Earnings 0.00
812.00 Total shareholders’ equity 10,000.00
$3,014,441.25 Total Liab and Shareholders’ Equity $18,590.00
Tech Master Inc. AVERAGE
As of 31 Dec 2014
Current Liabilities:
Accounts Payable 4,590.00
Total Current Liabilities 4,590.00
2,876,668.25
Notes Payable 4,000.00
Total Liabilities 8,590.00
Shareholders’ Equity
8,336.00 Common stock 10,000.00
Retained Earnings 0.00
812.00 Total shareholders’ equity 10,000.00
$2,885,816.25 Total 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 method Straight line depreciation
Year Start year Depreciation End Year Year Start year Depreciation End 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) Break Even Point analysis
Instructions: Complete this project by using BEP formula TC = FC + (VC X # of units)
Fill out the chart below and answer the question under the chart.
Fixed costs Option A = 3,000,000, option B = 0 and Option C = 600,000
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
Units Option A Option B Option C
100
