This is a straightforward complete accounting cycle in a manufacturing company, although it is considerably longer than previous cases of the same type. Students may find it helpful to refer back to the journal entries described in the text as a guide. Tracing through these entries is intended to give the student an understanding of what goes on in a manufacturing company and how these events are reflected in the accounts. I make a concerted attempt to link the problem’s numbers to illustrations 6-3 and 6-4 in the text, placing the T-accounts side-by-side (if board space permits) and using arrows to denote flows from one inventory account to another.
Simply because of its length, two days may be necessary for this case. In any event, it is desirable that some time be left for Question 3, which asks the students to use the information they have built up.
In effect, this case is a miniature practice set and can be treated as such if desired. It is a key case.
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