Ques. No.

1 :
Using FIFO
Date

1/1
3/1

Purchased

Issued

35
15

5
6

175
90

10/1

35
10

15/1

15

105

20/1

20

160

25/1

28/1

5
15
15
10

Balance

5
6

6
7
8

175
60

30
105
120

90

31/1

5
3

8
9

40
27

35
35
15
5

5
5
6
6

175
175
90
30

5
15
5
15
20

6
7
6
7
8

30
105
30
105
160

40

5
10
7

8
9
9

40
90
63

Make Sure:
using Q = Q purchased Q issued = Q balance
= (35+15+15+20+10) (35+10+5+15+15+5+3) = 95-88=7
Using Values= V Purchased V issued = V balance
= (175+90+105+160+90) (175+60+30+105+120+40+21)= 620-557=63

Using LIFO
Date

1/1
3/1

Purchased

Issued

35
15

5
6

175
90

10/1

15
30

15/1

15

105

20/1

20

160

25/1

28/1
31/1

20
15

10

6
5

8
7

Balance
V

90
150

160
105

90
8

Make Sure:
using Q = Q purchased Q issued = Q balance
= (35+15+15+20+10) - (15+30+20+15+8)= 95-88=7
Using Values= V Purchased V issued = V balance
= (175+90+105+160+90) (90+150+160+105+72)= 620- 577=43

72

35
35
15
5

5
5
6
5

175
175
90
25

5
15
5
15
20

5
7
5
7
8

25
105
25
105
160

25

5
10
5
2

5
9
5
9

25
90
25
18

Using Average
Date

Purchased

Issued

1/1
3/1

35
15

5
6

175
90

10/1
15/1

15

105

20/1

20

160

25/1
28/1

10

Balance

5
5
6
5.3
5.3
7
5.3
7
8
7.2875

175
175
90
26.5
26.5
105
26.5
105
160
36.4375

7.2876
9
8.429

36.4375
90
59.003

45

5.3

238.5

35

7.2875

255.0625

35
35
15
5
5
15
5
15
20
5

67.432

5
10
7

90

31/1

8.429

Make Sure:
using Q = Q purchased Q issued = Q balance
= (35+15+15+20+10) (45+35+8)= 95-88=7
Average cost 1 = 175+90/35+15= $5.3
Average cost2 = 26.5+105+160/5+15+20= $7.2875
Average cost3 = 36.4375+90/5+10= $8.429

Ques. No.2 :
Phinox Company , Income Statement , End Of May,2014.
Item

LIFO
Part

Sales Revenues
(3000*70)
- COGS

25*120=3000
15*130=1950
30*150=4500

Gross Profit
-Expenses:
Rent
Selling Expenses
Adm. & Adv. Expenses
Salaries
Income Before
Tax
- Taxes
Net Income

FIFO
Total
210,000

(9450)

Part

25*180=4500
30*150=4500
15*130=1950

200550
2000
4000
15000
40000
(61000)
30%*139550

2000
4000
15000
40000

139550
(41865)

Average
Total
210,000

Part

70*146.8
(10950)

(10276)

199050

199724

(61000)

2000
4000
15000
40000

138050
30%*138050

97685
Average Cost= (25*120)+(15*130)+(30*150)+(25*180)/25+15+30+25=146.8

Total
210,000

(41415)
96635

(61000)
138724

30%*138724

(41617.2)
97106.8

Ques. No.3 :
1Date
Jan.1,2011

Jan.1,2011

Jan.1,2014

Item

DR.
105000
115000

Cash
A/R
Ms Capital
(Ms share in the new business)
Land
Cs Capital
(Cs share in the new business)

550000

Equipment
A/R

220000
120000

CR.

220000

550000

A.D.A
Hs Capital
(Cs share in the new business)

10000
330000

A.D.A = A/R Expected to collect = 120000-110000= $10000

2a) $350000
Schedule Of Income Division
Item
Annual Salaries
M (20%*220000)
C (50%*550000)
H (30%*330000)

Total

44000
110000
66000
220000

Interest Rate
M (10%*44000)
C (10%*110000)
H (10%*66000)

4400
11000
6600
22000

Total Salaries & All.

Remaining Income/Loss
M 20%*108000
C 50%*108000
H 30%*108000

End balances

48400

121000

72600

242000

21600
54000
32400
108000

75000

175000

Remaining Income/Loss= Net Income Given- Total Salaries & All.

= 350000
- 242000
= 108000

105000

350000

b) $200000
Schedule Of Income Division
Item
Annual Salaries
M (20%*220000)
C (50%*550000)
H (30%*330000)

Total

44000
110000
66000
220000

Interest Rate
M (10%*44000)
C (10%*110000)
H (10%*66000)

4400
11000
6600
22000

Total Salaries & All.

Remaining Income/Loss
M 20%*(42000)
C 50%*(42000)
H 30%*(42000)

48400

121000

72600

242000

(21000)

(12600)

(8400)

End balances

(42000)

40000

100000

60000

200000

Remaining Income/Loss= Net Income Given- Total Salaries & All.

=200000
- 242000
= (42000)
3Schedule of Cash Distribution
Item

Cash

Beg. Balances
Sale of Non-Cash
Assets &
Recognize
Gain/Loss
New Balances
Payment of
liabilities
New Balances
Cash Distribution
End Balances

480000
920000

Non-Cash
Assets
770000
(770000)

Liabilities

Ms Capital

Cs Capital

Hs Capital

150000

220000

550000

330000

30000
75000
45000

1400000

-0-

(150000)
1250000

150000

625000

375000

250000

625000

375000

(250000)

(625000)

(375000)

-0-

-0-

-0-

(150000)
-0-

-0-

(1250000)

-0-

250000

-0-

-0-

B-

Cash
Balances before liquidation
H payment

Capital

Capital

Capital

$
(17,000)

$
(15,000)

4,000

Balance

Date

$ 28,000

$ 32,000

No.
1
2

$
4,000
(4,000)

$
(17,000)

$
(15,000)

Item

Dr.
4000

Cash
Hs Capital
Ms Capital
Cs Capital
Cash

Cr.
4000

17000
15000
32000

Ques. No.4 :
1Date

No.
1

Item

Dr.
180000

Cash
Common stock (10000*10)
Paid-in capital In Excess Of Par

100000
80000

Cash

100000
Common Stock

4
5

Cr.

100000

Cash

80000

Common Stock (10000*7)

Paid-In Capital In Excess Of Par
Cash (3000*50)
Preferred Stock (3000*50)
Cash
Preferred Stock (3000*50)
Paid-in Capital In Excess Of Par- Preferred
Stock
Land (10000*15)
Common Stock (10000*10)
Paid-in Capital In Excess of Par
Treasury Stock (2000*15)
Cash (20001*15)

70000
10000
150000
150000
200000
150000
50000
150000
100000
50000
30000
30000

2No. Of Outstanding Common Stocks = Total No. Of Outstanding Shares Preferred Stocks
= 55000-5000=50000 Shares
share
Common Stock book value is $11/share which does not equal its market value/share & its par value/share.