ACCT 200 Lecture 9 Outline of Last Lecture I Review II Uncollectibles III Net Realizable Value IV EOP adjustment V Notes Receivable VI Things to remember VII Homework 6 2 Outline of Current Lecture I What companies can do involving inventory II Methods III Accounts receivable turnover IV Turnover V Inventory Turnover VI Homework EP 1 Current Lecture I What companies can do involving inventory a Tell the difference between every item sold this involves big custom assets i e cars boats etc These notes represent a detailed interpretation of the professor s lecture GradeBuddy is best used as a supplement to your own notes not as a substitute b OR they cannot specifically identify what individual units sold like cans of Pepsi Coke etc II Methods a Average cost b FIFO first in first out c LIFO last in first out III Accounts receivable turnover a This tells how quickly a company collects receivables in a measure of liquidity ease of turning it into cash IV Turnover a Turnover net credit sales average net accounts receivable b Net accounts receivable Accounts Receivable allowance for doubtful accounts c Average accounts receivable beginning of year Accounts Receivable end of year accounts receivable 2 d The higher the return ratio the better V Inventory Turnover a Inventory Turnover cost of goods sold average inventory b Average inventory beginning of year inventory end of year inventory 2 c The higher the inventory turnover the better VI Homework EP 1 a Note receivable 90000 Accounts receivable 90000 b Interest received 362 50 Interest revenue 362 5 c Interest revenue 387 50 d Collect cash e Cash 90750 Note receivable 90000 Interest receivable 750 NO REVENUE IS MADE IN NOVEMBER it is only collected in November
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