3. • Perpetual
• Periodic
• a company physically counts inventory at the end of each period to determine
what's on hand and the cost of goods sold.
The system according to which every movement that takes place on an
ongoing basis on the stock is processed from withdrawal or addition,
goods in progress and cost of goods sold on a daily basis.
Accounting for Merchandising Operations
4. FIFO :
The FIFO (first-in, first-out) method assumes that the earliest goods
purchased are the first to be sold.
LIFO :
The LIFO (last-in, first-out) method assumes that the latest goods
purchased are the first to be sold.
Average-Cost :
The average-cost method allocates the cost of goods available for sale based on the
weighted average unit cost incurred.
Accounting for Inventories
5.
6. Types of receivables :..
Methods g for uncollectible accounts:
account receivable
-Other receivables
-Note receivable
write off
allowance
Accounting for
Receivables
7. Plant assets are resources that have a physical substance (a definite size and shape ), are used in the operation of
a business and are not intended for sale to customers . Thy are also called
Property , plant ,and equipment; plant and equipment; or fixed asset .
A) Determining cost of plant Assets
B) Depreciation of plant asset
C) Disposal of plant asset
Plant Assets, Natural Resources, and Intangible Assets
9. background of nike company
Nike is a large American company that produces sportswear, shoes and equipment. Established on
January 25, 1964 as Blue Ribbon Sports, by Bill Bowerman and Philip Knight, and its name changed to Nike
in 1978.
11. Nike company applies the weighted
average cost method
Nike company use perpetual
inventory system.
12.
13.
14.
15. measures the number of times on average the inventory is sold during the
period
inventory turnover ratio = cost of goods sold / average inventory
Average inventory = Beginning inventory+ ending inventory / 2
Inventory turnover:..
16. Plant assets are resources that have a physical substance (a definite size and shape ), are used in
the operation of a business and are not intended for sale to customers . Thy are also called
Property , plant ,and equipment; plant and equipment; or fixed asset
2) Depreciation of plant asset
3) Disposal of plant asset
1) Determining cost of plant Assets
17. Property, plant and equipment are recorded at cost. Depreciation is determined on a straight-line basis for land
improvements, buildings and leasehold improvements over 2 to
40 years and for machinery and equipment over 2 to 15 years.
18.
19. Asset turnover = net sales / average total asset
Average Asset = Beginning + Ending Asset / 2
Beginning Asset = 37,740
Ending Asset = 31,342
37,740+31,342 / 2 = 31,344
Net sales = 44,538
44,538 / 31,344
= 1.42