Formulas to memorize exam 2 PDF

Preview

Summary

formulas need to be memorized for all exams...

Description

Inventory problem #1 PP&E--Formulas

COGS under FIFO cash flow assumption

Average depreciable life

Step 1. Beginning inventory + purchases = COGS available for sale (-) Ending Inventory = COGS

averagedepreciable assets(gross) depreciation expense Age of depreciable assets

accumulated depreciation at year end depreciation expense Timeline for replacing existing PP&E Average depreciable life - age of depreciable assets Depreciation expense difference

c h ange ∈ t h e deffered tax liaability ¿ ¿ PP∧E Tax rate Accelerated depreciation expense (used for tax purposes) Depreciation expense + depreciation expense differentiation Restated net income Reported Net Income + Straight line depreciation expense (1-tax) (-) accelerated depreciation expense (1-tax)

Step 2. make adjustments + beginning Inv + ending inv Partial income statement under FIFO cost flow assum Sales --> same as LIFO sales (-) COGS --> adjusted COGS = GM GM percentage under LIFO/FIFO GM/Sales...