5 E8-13 (FIFO and Average-Cost Determination) LoBianco Company's record of transactions for the month of April was as follows. Purchases Sales April 1 (balance on hand) April 3 500 @ $10.00 600 @ $6.00 1,500 6.08 4 9 1,300 10.00 8 800 6.40 11 600 11.00 13 1,200 @ 6.50 23 1,200 11.00 21 27 12.00 700 @ 6.60 500 @ 6.79 29 4,500 5,300 Instructions (a) Assuming that periodic inventory records are kept, compute the inventory at April 30 using (1) FIFO and (2) average-cost. (b) Assuming that perpetual inventory records are kept in both units and dollars, determine the inventory at April 30 using (1) FIFO and (2) average-cost. (c) In an inflationary period, which inventory method-FIFO or average-cost-will show the highest net income? 900 @

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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5 ES-13 (FIFO and Average-Cost Determination) LoBianco Company's record of transactions for the
month of April was as follows.
Purchases
April 1 (balance on hand)
Sales
April 3
600 © $6.00
1,500 @ 6.08
500 @ $10.00
9 1,300 @ 10.00
4
8
800 @ 6.40
11
600 @ 11.00
23 1,200 @ 11.00
27
13
1,200 @ 6.50
21
700 @ 6.60
900 @ 12.00
29
500 @ 6.79
4,500
5,300
Instructions
(a) Assuming that periodic inventory records are kept, compute the inventory at April 30 using
(1) FIFO and (2) average-cost.
(b) Assuming that perpetual inventory records are kept in both units and dollars, determine the
inventory at April 30 using (1) FIFO and (2) average-cost.
(c) In an inflationary period, which inventory method-FIFO or average-cost-will show the highest
net income?
Transcribed Image Text:5 ES-13 (FIFO and Average-Cost Determination) LoBianco Company's record of transactions for the month of April was as follows. Purchases April 1 (balance on hand) Sales April 3 600 © $6.00 1,500 @ 6.08 500 @ $10.00 9 1,300 @ 10.00 4 8 800 @ 6.40 11 600 @ 11.00 23 1,200 @ 11.00 27 13 1,200 @ 6.50 21 700 @ 6.60 900 @ 12.00 29 500 @ 6.79 4,500 5,300 Instructions (a) Assuming that periodic inventory records are kept, compute the inventory at April 30 using (1) FIFO and (2) average-cost. (b) Assuming that perpetual inventory records are kept in both units and dollars, determine the inventory at April 30 using (1) FIFO and (2) average-cost. (c) In an inflationary period, which inventory method-FIFO or average-cost-will show the highest net income?
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