DERIVATIONS Computational

No.

Answer Derivation

68.

Product 1: RC = $45, NRV = $80 $10 = $70

NRV PM = $70 ($80 .3) = $46, cost = $40.
Product 2: RC = $54, NRV = $130 $26 = $104
NRV PM = $104 ($130 .3) = $65, cost = $70.

69.

NRV = $20 $4 = $16, RC = $17

NRV PM = $16 ($20 .40) = $8, cost = $18.

70.

NRV = $40 $8 = $32, RC = $34

NRV PM = $32 ($40 .40) = $16, cost = $36.

71.

$29.00 MV, $32.00 Cost, LCM = $29.00.

72.

$7.73 ($8.35 $0.62) MV, $8.50 Cost, LCM = $7.73.

73.

$76.98 MV, $86.62 Cost, LCM = $76.98.

74.

Ceiling $169 ($190 $21); Floor $93 ($169 $76), RC $166; $166 MV.

75.

Ceiling $169 ($190 $21), Floor $93 ($169 $76), RC $166; $166 MV,
$160 Cost, LCM = $160.

76.

$65 Cost.

77.

Ceiling $74 ($90 $16), Floor $56 ($74 $18), RC $60; $60 MV,
$65 Cost, LCM = $60.

78.

$6,100 MV, $6,500 Cost, LCM = $6,100.

79.

$596 ($624 $28) MV, $698 Cost, LCM = $596.

80.

$468 MV, $502 Cost, LCM = $468.

81.

$600,000 $10,000 = $590,000.

82.

$350,000 $5,000 = $345,000.

83.

LF 3,000 $15 = ($45,000 $80,000) $50,000 = $28,125

1B 7,000 $5 = $35,000; $35,000 + $45,000 = $80,000
(1,000 $15) ($28,125 1,000/3,000) = $5,625.

84.

CF 3,000 $12 = ($36,000 $64,000) $40,000 = $22,500

3B 7,000 $4 = $28,000; $28,000 + $36,000 = $64,000
(1,000 $12) ($22,500 1,000/3,000) = $4,500.

DERIVATIONS Computational (cont.)

No.
85.

Answer Derivation
c

Item # of Items Price

M
4,000 $2.50 = 10,000

10 50 $48,000 = $9,600 4,000 =

$2.40
N

2,000 $8.00 = 16,000

16 50 $48,000 = $15,360 2,000 =

6,000 $4.00 = 24,000

24 50 $48,000 = $23,040 6,000 =

$7.68
$3.84
50,000
86.

(2,500 $0.25) + (5,500 $0.60) + (500 $1.20) = $4,525;

[(2,500 $0.25) $4,525] $3,000 = $414 2,500 = $0.166.

87.

(2,500 $0.25) + (5,500 $0.60) + (500 $1.20) = $4,525;

[(5,500 $0.60) $4,525] $3,000 = $2,188 5,500 = $0.398.

88.

(2,500 $0.25) + (5,500 $0.60) + (500 $1.20) = $4,525;

[(500 $1.20) $4,525] $3,000 = $398 500 = $0.796.

89.

$2.5 million $2.3 million = $200,000.

90.

$2.5 million $2.2 million = $300,000.

91.

($4.00 $3.10) 100,000 = $90,000.

92.

No gain or loss since 12/31 price ($5.60) > contract price ($5,00).

93.

($5.00 $4.60) 1,000 = $400.

94.

($50,000 + $150,000) ($300,000 5/3) $3,000 = $17,000.

95.

($100,000 + $300,000) ($600,000 5/3) $6,000 = $34,000.

96.

(1 + .2)C = 1,980,000; C = $1,650,000.

97.

COGS:

98.

99.

$360,000
+ ($420,000 $240,000) = $540,000.
.40
2.9 29%
1 .40

100.

COGS = $300,000 1.25 = $240,000

($220,000 + $172,000 $8,000) $240,000 = $144,000.

101.

COGS = $2,000,000 .75 = $1,500,000

$800,000 + $1,600,000 $1,500,000 = $900,000.

102.

$900,000 ($800,000 .80) = $260,000.

July = $2,040,000 1.2 = $1,700,000

Aug. = $2,160,000 1.2 = $1,800,000
July's purchase = ($1,700,000 .7) + ($1,800,000 .3) = $1,730,000.

DERIVATIONS Computational (cont.)

No.

Answer Derivation

103.

$300,000
$50,000 + $250,000 = $60,000.
1.25

104.

($15,000 40%) + $13,000 + ($7,600 $6,400) = $20,200.

105.

25% (100% 25%) = 33%.

106.

$650,000 ($650,000 1.20) = $108,333.

107.

($320,000 + $85,000) [$250,000 (1 .40)] = $255,000.

108.

($680,000 + $165,000) [$360,000 (1 .40)] = $629,000.

109.

$1,650,000 + $683,000 + $78,000 [$1,210,000 (1 .30)] = $1,564,000.

110.

$198,000 + $1,100,000 + $24,000 $1,050,000 $36,000 = $236,000;

($130,000 + $685,000 + $43,000) ($198,000 + $1,100,000 + $24,000) = .

649;
$236,000 .649 = $153,164.
111.

$99,000 + $865,600 + $69,000 $811,000 = $222,600;

($65,500 + $568,000 + $26,500) ($99,000 + $865,600 + $69,000) =

63.9%;
$222,600 .639 = $142,241.
112.

$326,900 + $1,386,100 + $2,000 $1,302,000 $96,300 = $316,700;

($265,600 + $1,068,600 + $63,900) ($326,900 + $1,386,100 + $2,000) =
81.5%;
$316,700 .815 = $258,111.

113.

Cost: $30,000 + $145,000 + $2,500 = $177,500.

Retail: $50,000 + $200,000 + $8,500 = $258,500.

114.

$70,000 + $320,000 + $20,000 $14,000 $336,000 = $60,000.

115.

Cost: $49,000 + $224,000 + $6,000 = $279,000.

Retail: $70,000 + $320,000 + $20,000 = $410,000.

116.

Conceptual.

*117.

$49,000
$60,000 = $42,000.
$70,000

*118.

Conceptual.

119.
$2,600

$3,600 + $114,000 + $18,000 $4,000 $70,200 $1,600 $2,800

= $54,400.

120.
$2,600

$3,600 + $94,000 + $18,000 $4,000 $70,200 $1,600 $2,800

= $34,400.

DERIVATIONS Computational (cont.)

No.

Answer Derivation

121.

$375,000 [($60,000 + $90,000) 2] = 5; 365 5 = 73.0.

122.

$385,000 [($60,000 + $80,000) 2] = 5.5; 365 5.5 = 66.4.

123.

$600,000 [($80,000 + $120,000) 2] = 6 times

124.

$1,879,400 [($360,000 + $411,000) 2] = 4.88.

125.

Cost: $78,000 + $295,000 + $5,000 = $378,000.

Retail: $122,000 + $415,000 + $15,000 = $552,000.

126.
d
$140,000.

$122,000 + $415,000 $2,000 + $15,000 $20,000 $390,000 =

127.

$140,000 .685 = $95,900.

*128.

*129.

Cost: $295,000 + $5,000 = $300,000.

Retail: $415,000 + $15,000 $20,000 = $410,000.
$140,000
$125,000
1.12
Base year price = EI =
$122,000 @ cost
=
$3,000 .732* 1.12 =

$78,000
2,460
$80,460

$300,000
* = .732
$410,000
*130.

Cost to retail ratio = $378,000 ($562,000 + $68,000 $30,000) = 0.63

EI = $140,000 + $562,000 + $68,000 $30,000 $530,000
= $210,000 at retail
$210,000 $140,000 = $70,000
Cost of inventory = $94,000 + ($70,000 .63) = $138,100.

*131.

Base year price: EI = $210,000 1.05 = $200,000

$140,000 @ cost
= $ 94,000
60,000 .63 1.05 =
39,690
$200,000
$133,690

DERIVATIONS CPA Adapted

No.

Answer

Derivation

132.

$250,000 $225,000 (RC) = $25,000.

133.

Conceptual.

134.

Conceptual

DERIVATIONS CPA Adapted (cont.)

No.

Answer

135.

Derivation
$3,800,000 .75 = $2,850,000 (COGS)
$600,000 + $3,000,000 $2,850,000 $700,000 = $50,000.

136.

137.

($200,000 + $1,000,000) ($250,000 + $1,575,000 + $175,000) = 0.6

($250,000 + $1,575,000 + $175,000 $20,000 $110,000
$1,750,000) 0.6 = $72,000.
$980,000 $1,400,000 = 0.7
($1,400,000 $10,000 $1,050,000) 0.7 = $238,000.

*138.

$550,000 1.1 = $500,000

$300,000 + ($80,000 1.1 .7) = $361,600.