Case 1 Questions

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Cash in the bank is reported on the balance sheet dated December 31,2012 is composed of:

Checking account: $324,935

Money market savings account that does not have checking privileges: $100,000

Certificate of deposit, 2% maturing on May 1st 2013=$25,000

Certificate of deposit, 1.5% maturing on January 15th, 2013=$50,000

Cash held as compensating balance, to be held until January 1st, 2015=$10,000

Required: Make necessary journal entries to correct the cash account

I-6

P&P Products implemented Dollar Value LIFO inventory valuation in 2009, when their ending inventory was $650,000. The following are the inventory amounts for an ingredient used in packaging for years 2010-2014.

Year: 2010

Inventory at end of year prices: 697,200

Price index: 105

Year: 2011

Inventory at end of year prices: 795,800

Price index: 115

Year: 2012

Inventory at end of year prices: 805,200

Price index: 120

Year: 2013

Inventory at end of year prices: 856,500

Price index: 125

Year: 2014

Inventory at end of year prices: 901,800

Price index: 135

Required:

Calculate the ending inventory for years 2009-2014 using Dollar Value LIFO