In 2020, Dooling Corporation acquired Oxford Inc. for $250 million, of which $50 million was attributed to goodwill. At the end

Answer:

The solution and relevant data for the exercise are contained within three images. The maximum profit amounts to 262.500.

Explanation

Please take into account the details provided in the exercise. Should you have any queries, feel free to reach out again. All the exercises are illustrated within three images.

The expected cash balance at the end of February is $113,300.

Tamarisk should report an inventory amount of $252,000 as of December 31. To arrive at this figure, consider the following calculation: Inventory = Stock on hand + goods acquired from Sheffield Corp + goods sold to Wildhorse Co. This gives us the calculation: $190,000 + $29,000 + $33,000 = $252,000. All relevant amounts were taken into account, including considerations for FOB destination and FOB shipping point, which contribute to the physical inventory count.

Part a. Produce the goods in-house and allow international sales managers to oversee marketing. Advantages include: - Complete authority over production processes. - Simplicity in strategizing and scaling manufacturing. - Enhanced control over human resources. - Increased comprehension of European markets by foreign sales agents. - Reduced exit costs in case of product failure. Disadvantages consist of: - Limited knowledge regarding pharmaceutical protocols in Europe. - Risks to the brand's reputation if not correctly managed by foreign agents. - Extra expenses in product delivery. Part b. Produce the items in-house and establish a wholly-owned entity in Europe for marketing. Pros encompass: - Full oversight of manufacturing operations. - Ease in creating strategies and ramping up production. - Better human resource oversight. - Protection of brand integrity since marketing is managed internally. Cons include: - Increased resource allocation for marketing. - Insufficient information about pharmaceutical standards in Europe. - Extra delivery costs. Part c. Form a strategic partnership with a significant European pharmaceutical entity to manufacture products via a 50/50 joint venture for marketing. Pros involve: - Risk-sharing among the enterprises. - No additional costs for delivery. - Valuable insights into European regulations and marketing. Cons involve: - Diminished control over manufacturing. - Share profits among partners. - Moderate exit costs involved. - Possible brand image damage due to the additional firm.

Response:

A.

Dec. 28, 20Y3

Dr Accounts Receivable - Beasley Co. 18,500

Cr Sales Revenue 18,500

Dec. 28, 20Y3

Dr Cost of Goods Sold 11,200

Cr Inventory 11,200

B.

Jan. 3, 20Y4

Dr Sales Returns and Allowances 4,000

Cr Accounts Receivable - Beasley Co. 4,000

Jan. 3, 20Y4

Dr Inventory 2,350

Cr Cost of Goods Sold 2,350

C. Jan. 7, 20Y4

Dr Cash 14,210

Dr Sales Discount 290

Cr Accounts Receivable - Beasley Co. 14,500

Explanation:

A. Recording the entry for the sale on December 28, 20Y3, using a perpetual inventory system’s net method.

Dec. 28, 20Y3

Dr Accounts Receivable - Beasley Co. 18,500

Cr Sales Revenue 18,500

Dec. 28, 20Y3

Dr Cost of Goods Sold 11,200

Cr Inventory 11,200

B. Journals to record the returns of merchandise

Jan. 3, 20Y4

Dr Sales Returns and Allowances 4,000

Cr Accounts Receivable - Beasley Co. 4,000

Jan. 3, 20Y4

Dr Inventory 2,350

Cr Cost of Goods Sold 2,350

C. Journal entry to document the receipt of amount owed

Jan. 7, 20Y4

Dr Cash 14,210

[(18,500-4,000)-(18,500-4,000)*2% ]

Dr Sales Discount 290

[(18,500-4,000)*2% ]

Cr Accounts Receivable - Beasley Co. 14,500

(18,500-4,000)