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					WP 6.4                                                                                                                    Prepared by:
                               BILTRITE BICYCLES, INC.                                                                    Date:
                                   Inventory Cutoff                                                                       Reviewed by:
                                   December 31, 1996                                                                      Date:

                                           PURCHASES CUTOFF
                     --------------------- --------------- -----------------
                                                                                                                          INVENTORY
           DATE                                 RECEIVING                                                                  INCLUDED
         RECORDED    VOUCHER NO.               REPORT NO.     DATE SHIPPED           DATE RECEIVED    FREIGHT TERMS        EXCLUDED      COST

     12/31/2006               12456             01-12486         12/27/2006           12/30/2006      FOB   destination   Included $1,445,900
     12/31/2006               12457             01-12487         12/26/2006           12/31/2006      FOB   ship. point   Included   $962,200
      1/2/2007                12458             01-12488         12/28/2006           12/31/2006      FOB   ship. point   Included   $488,754
      1/3/2007                12459             01-12489         12/29/2006           12/31/2006      FOB   ship. point   Included   $365,400
      1/3/2007                12460             02-13001         12/30/2006            1/2/2007       FOB   ship. point   Excluded $1,879,000   (1)
      1/4/2007                12461             02-13002          1/2/2007             1/3/2007       FOB   ship. point   Excluded   $438,870   (2)

                     (1)   Voucher 12460 was for the purchase of raw materials
                     (2)   Voucher 12461 was for the purchase of parts


                                           SALES CUTOFF
                     --------------------- --------------- -----------------                                              INVENTORY
    SALES INVOICE                                                                                                          INCLUDED
        NUMBER             DATE SHIPPED       DATE RECORDED     FREIGHT TERMS        SELLING PRICE           COST          EXCLUDED

          33002            12/30/2006          12/30/2006      FOB   ship.   point         $266,800            $205,436   excluded
          33003             1/2/2007           12/30/2006      FOB   ship.   point         $881,870            $679,040   included
          33004             1/2/2007           12/30/2006      FOB   ship.   point         $443,760            $341,695   included
          33005            12/31/2006          12/31/2006      FOB   ship.   point         $144,600            $111,342   excluded
          33006             1/2/2007           12/31/2006      FOB   ship.   point         $773,200            $595,364   included
          33007             1/3/2007           12/31/2006      FOB   ship.   point         $338,700            $260,799   included
          33008            12/31/2006          12/31/2006      FOB   ship.   point         $122,900             $94,633   excluded
          33009             1/3/2007           12/31/2006      FOB   ship.   point       $1,322,800          $1,018,556   included
          33010             1/4/2007            1/4/2007       FOB   ship.   point         $488,900            $376,453   included
          33011             1/4/2007            1/4/2007       FOB   ship.   point         $788,211            $606,922   included

All adjustments of perpetual to physical inventories have been made
  through "Cost of Goods Sold."

Examined the following documents for a few days before and after the
  balance sheet date to determine that transactions were recorded
  in the proper accounting period:
   Vouchers
   Receiving Reports
   Freight Invoices
   Sales Invoices
   Bills of Lading

All sales are shipped "FOB shipping point."

Examined freight invoices for incoming shipments to locate possible
  goods in transit for which title had passed before year-end.

				
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