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Devry ACCT 505 Week 3 Case Study

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Devry ACCT 505 Week 3 Case Study

2 Gary is recommending that the completion percentage by adjusted by 15 percentage points in order to assist the team in making their bonus.
a. Calculate the cost of goods sold if the ending inventory is 15% complete in regard to conversion costs. Would net income increase or decrease if this option was chosen over the 30% completion percentage? How much is the increase?

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b. Calculate the cost of goods sold if the ending inventory is 45% complete in regard to conversion costs. Would net income increase or decrease if this option was chosen over the 30% completion percentage? How much is the increase?
c. Based on your calculations, which percentage is Gary suggesting that Mary use for her ending inventory calculations.
3 Do you think Mary James should go along with the request to alter estimates of the percentage completion? Why or why not