In this video, learn how to identify the various valuation issues associated with inventory and cost of goods sold. This can impact earnings per share.
- For a retail company, the most important expense … on the income statement is cost of goods sold. … However, even in a simple situation, … a surprisingly difficult question to answer is, … how much is cost of goods sold? … Consider these transactions for Ramona Rice Company. … On March 23rd, she purchased 10 kilograms of rice … for $4 per kilo, total cost $40. … On November 17th, she purchased 10 kilograms of rice … for $9 per kilo, that's total $90. … And then finally, on December 31st, … she sold 10 kilograms of rice for $10 per kilo, … total selling price $100. … Let's start with a simple question. … What is the operating cash flow for Ramona Rice Company … for the year? … The computation is easy. … Paid $40 for the March 23rd rice purchase, … paid $90 for the November 17th rice purchase, … and then collected $1000 for the December 31st rice sale. … Minus $40, minus $90, plus $100, … that's negative $30 in operating cash flow … for the year. … Now there is no ambiguity about this number. …
- Accounting basics
- Reviewing the balance sheet and income statement
- Credits, debits, and journal entries
- Making financial statements
- Issues in financial accounting
- Revenue recognition
- Deferring taxes
- Analyzing financial statements
Skill Level Beginner
Accounting Foundations: Internal Controlswith Kay Stice1h 46m Intermediate
Cost Accounting: Analyzing Product Profitabilitywith Rudolph Rosenberg56m 49s Intermediate
Why financial accounting?1m 13s
1. Accounting Basics
The accounting equation3m 37s
2. The Financial Statement
3. The Mechanics of Accounting
4. Current Issues in Financial Accounting
5. Financial Statement Analysis
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