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Midterm
Midterm
PROBLEM VARIATIONS
Science
transportation model may involve one or more of the
following situations:
Transshipment problem In general, the network model DUMMYORIGIN, added to a transportation problem
for these problems consists of nodes representing to make the total supply equal to total demand. The
origins, destinations, and, if necessary, transshipment supply assigned to the dummy origin is the difference
points in the network system. between the total demand and the total supply.
Arcs are used to represent the routes for shipment, MAXIMIZATION OBJECTIVEFUNCTION In some
travel, or flow between various nodes. transportation problems, the objective is to find a
solution that maximizes profit or revenue.
Unbalanced
A B C D
1 15 21 25 29
2 5 10 14 16
3 7 12 16 19
0 0 0 0
0 0 0 0 0 0 0 0
AC E D 50
0 1 1 5 4 = 4 Optimal
E 20
T F
0 0 0 2 Optical Assignment: Optimal S
0 0 0 3
Cost 50 30 80
L L
0 0 0 0 1-A D
=15+10+16
S F
2-B =41
Early start time (ES)
3-C
- Early start time denotes the earliest possible point at
Chapter 8: Non-Linear Optimization which an activity may be commenced.
Model -The ES for the first task(s) in a project is set to zero.
A nonlinear optimization problem is any optimization
To calculate the ES for all other tasks, just copy the
problem in which at least one term in the objective
EF (Early finish time) of the preceding dependent
function or a constraint is nonlinear.
task. If a task is dependent on two or more previous
CHAPTER 9: PROJECT SCHEDULING activities, refer to the activity with the longer ES.
Accounting by the periodic inventory system, under Segregation of duties. – purchasing, receiving,
periodic inventory system the purchase of direct and storage, use, recording.
indirect materials is recorded in an account entitled
“Purchases”. If a beginning material inventory exist it Accuracy in recording. Inventory records shout permit
is recorded in a separate account entitled “materials determination of inventory quantities on hand upon
inventory – Beginning”. Purchases added to the request.
materials inventory. Ending material inventory is
determined by a physical count of the materials on
hand at the end of the period. Controlling the investment in materials
balance
received issued
1,600 x 6.00
9,600`
400 x 7.00
2,800
a) EOQ = √ 2 (number of units required annually)
(cost of order) / carrying cost per unit 9 400 x 1,600 x 6.00
8.00 3,200 9,600
√ 2 x 13,000 x 200 / 5.20
400 x 7.00
√ 5,200,000 / 5.20 2,800
400 x 8.00
3,200
400 x 7.00
2,800
400 x 8.00
3,200
600 x 9.00
5,400
Average inventory based on EOQ
27 800 x 200 x 7.00
=1,000/2 6.00 1.400
4,800
= 500 400 x 8.00
200 x 3,200
d)Total carrying cost
7.00
1,400 600 x 9.00
Average inventory x Carrying cost/unit
5,400
=500 x 5.20
=P 2,600
1 1,600 x 6.00
9,600
1.Safety stock
2.Reorder point
Total xx
Cash in bank
Bank debits refers to all items debited to the account Balance per book 50,000 70,000
of the depositor which include check paid by bank and
Balance per bank 84,000 124,000
debit memos.
Book debits 200,000
In T account form, the depositor account, Company X
will appear as follows: Book credits 180,000
Company X Bank debits 130,000
Service charge: Thus, the January NSF of 5,000 and January service
charge of 1,000 are deducted from the February book
January (1,000) (1,000) disbursement.
Adjusted book 59,000 205,000 184,000 80,000 4.Debit memos for the current month already
Balance
increased bank disbursement for the current month
Balance per bank but have no effect on the book of disbursement.
Deposits in transits: 84,000 170,000 130,000 124,000
Thus, February NSF of 10,000 is added to the
January 40,000 (40,000) February book disbursement.
February 75,000 (75,000)
COMMENTS ON BANK ITEMS
Outstanding checks:
January (65,000) (65,000) 1. Deposit in transit of the previous month do not
February 119,000 (119,000) affect the bank receipts for the current month.
Adjusted bank 59,000 205,000 184,000 80,000
Thus, January deposit in transit of 40,000 is deducted
balance from the February bank receipts.
1.Credit memos of the previous month do not affect BOOK TO BANK METHOD
the bank receipts for the current month but increased Company X
the book receipts for the current month because the Proof of cash
credit memos for the previous month are recorded For the month of February
only by the depositor during the current month. Jan31 Receipts D Feb
Balance per book 50,000 200,000 180,000 Service charge:
70,000 January (1,000) (1,000)
Note collected Balance per book 50,000 200,000 180,000 70,000
January 15,000 (15,000) 20,000
February 20,000 20,000
NSF check: COMMENTS
January (5,000) (5,000)
February 10,000 (10,000) 1.The bank reconciling items- deposit in transit and
Service charge: outstanding check are treated in the same manner
January (1,000) (1,000) following adjusted balance method.
Deposits in transits: 84,000 170,000 130,000 124,000
January 40,000 (40,000) 2. the book reconciling items-note collected, NSF and
service are treated in the reversed.
February 75,000 (75,000)
Outstanding checks:
Chapter 4: Accounts Receivable
January (65,000) (65,000)
February 119,000 (119,000) TRADE AND NONTRADE RECEIVABLES
Balance per bank 84,000 170,000 130,000 124,000 Trade receivables refer to claims arising from sale of
merchandise or service in the ordinary course of
COMMENTS business.
1.The book reconciling items- note collected, NSF
Trade receivables include accounts receivable and
and service charge are treated in the same manner
notes receivable.
following the adjusted balance method.
Accounts receivable are open accounts arising from
2.The bank reconciling items- deposit in transit and the sale of goods and services in the ordinary course
outstanding check are treated in the reverse. of the business and not supported by promissory
notes.
3.The book to bank proof of cash means that the book
receipts and disbursement are adjusted to equal the -Customers’ accounts
bank receipts and disbursements.
-Trade debtors
4.Deposits in transit of previous month do not affect -Trade accounts receivable
the book receipts for the current month but increased
the bank receipts for the current month. Note receivable are those supported by formal
promises to pay in the form of notes.
BANKS TO BOOK METHOD
Nontrade receivables represent claims arising from
sources other than the sale of merchandise or
Company X service.
Proof of cash
For the month of February Trade receivables normal operating cycle or one year
Jan31 Receipts D Feb and Non trade receivables within one year CURRENT
Balance per bank 84,000 170,000 130,000 124,000 ASSETS.
Deposits in transits
Collectable beyond one year is classified
January 40,000 (40,000)
NONCURRENT ASSETS
February 75,000 (75,000)
Outstanding checks: PRESENTATION
January (65,000) (65,000) Accounts receivable xx
February 119,000 (119,000)
Allowance for doubtful accounts xx
Note collected
January 15,000 (15,000) 20,000 Notes receivable xx
February 20,000 20,000
NSF check: Accrued interest on note receivable xx
January (5,000) (5,000)
February 10,000 (10,000) Advances to officers and employees xx
Dividends receivables xx -Freight prepaid means that freight charge on the
goods shipped is already paid by the seller.
Total trade and other receivables 6,300,000
ACCOUNTING FOR FREIGHT CHARGE
Trade receivables and nontrade which are currently Example:
collectible shall be presented on the face of the
statement of financial position as one line item called An entity has a 100,000-account receivable ate the
trade and other receivables. end of accounting period. The terms 2/10, n/30, FOB
destination and freight collect. The customer paid
freight charge of 5,000.
EXAMPLES OF NONTRADE RECEIVABLES 1.To record the sale:
a.Advances to or receivables from shareholders, Accounts receivable 100,000
directors, officer or employees. If collectible in one
year such advances or receivables should be Freight out 5,000
classified as current assets.
Sales 100,000
b.Advances to affiliate are noncurrent assets
investments. Allowance for freight charge 5,000
d.Subscriptions receivable should be shown 2.To record the collection within the discount period:
preferably as a deduction from share capital unless Cash 93,000
collectible currently.
Sales discount 2,000
e.Creditors’ accounts with debit balances are
classified current assets. Allowance for freight charge 5,000
The amortized cost is actually the net realizable value Allowance for sales return 50,000
of accounts receivable, more relevance in long term
note receivable.
SALES DISCOUNT
TERMS RELATED TO FREIGHT CHARGE
A cash discount also known as sales discount on the
-FOB destination means that ownership of the goods part of the seller and a purchase discount in the part
purchased is vested in the buyer upon receipt thereof. of the buyer.
-FOB shipping point means that ownership of the METHOS OF RECORDING CREDIT SALES
goods purchased is vested in the buyer upon
shipment thereof. a. Gross method- the account receivable and sales
are recorded at gross amount of invoice. Common
-Freight collect means that freight charge on the and widely used method simple to apply.
goods shipped is not yet paid.
b. Net method- the account receivable and sales are ILLUSTRATION – ALLOWANCE METHOD
recorded at net amount of the invoice. Price minus the
cash discount whether taken or not taken. 1.Accounts of 30,000 are considered doubtful of
collection.