a. Assuming that the perpetual inventory system is used, costing by the LIFO method, determine the cost of merchandise sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 4. Under LIFO, if units are in inventory at two different costs, enter the units with the HIGHER unit cost first in the Cost of Merchandise Sold Unit Cost column and LOWER unit cost first in the Inventory Unit Cost column. Date Quantity Purchased Purchases Unit Cost Purchases Total Cost Quantity Sold Cost of Merchandise Sold Unit Cost Cost of Merchandise Sold Total Cost Inventory Quantity Inventory Unit Cost Inventory Total Cost May 1 fill in the blank a0cf470d4fcf014_1 $fill in the blank a0cf470d4fcf014_2 $fill in the blank a0cf470d4fcf014_3 May 10 fill in the blank a0cf470d4fcf014_4 $fill in the blank a0cf470d4fcf014_5 $fill in the blank a0cf470d4fcf014_6 fill in the blank a0cf470d4fcf014_7 fill in the blank a0cf470d4fcf014_8 fill in the blank a0cf470d4fcf014_9 fill in the blank a0cf470d4fcf014_10 fill in the blank a0cf470d4fcf014_11 fill in the blank a0cf470d4fcf014_12 May 12 fill in the blank a0cf470d4fcf014_13 $fill in the blank a0cf470d4fcf014_14 $fill in the blank a0cf470d4fcf014_15 fill in the blank a0cf470d4fcf014_16 fill in the blank a0cf470d4fcf014_17 fill in the blank a0cf470d4fcf014_18 fill in the blank a0cf470d4fcf014_19 fill in the blank a0cf470d4fcf014_20 fill in the blank a0cf470d4fcf014_21 May 14 fill in the blank a0cf470d4fcf014_22 fill in the blank a0cf470d4fcf014_23 fill in the blank a0cf470d4fcf014_24 fill in the blank a0cf470d4fcf014_25 fill in the blank a0cf470d4fcf014_26 fill in the blank a0cf470d4fcf014_27 May 20 fill in the blank a0cf470d4fcf014_28 fill in the blank a0cf470d4fcf014_29 fill in the blank a0cf470d4fcf014_30 fill in the blank a0cf470d4fcf014_31 fill in the blank a0cf470d4fcf014_32 fill in the blank a0cf470d4fcf014_33 fill in the blank a0cf470d4fcf014_34 fill in the blank a0cf470d4fcf014_35 fill in the blank a0cf470d4fcf014_36 May 31 fill in the blank a0cf470d4fcf014_37 fill in the blank a0cf470d4fcf014_38 fill in the blank a0cf470d4fcf014_39 fill in the blank a0cf470d4fcf014_40 fill in the blank a0cf470d4fcf014_41 fill in the blank a0cf470d4fcf014_42 fill in the blank a0cf470d4fcf014_43 fill in the blank a0cf470d4fcf014_44 fill in the blank a0cf470d4fcf014_45 May 31 Balances $fill in the blank a0cf470d4fcf014_46 $fill in the blank a0cf470d4fcf014_47 b. Based upon the preceding data, would you expect the inventory to be higher or lower using the first-in, first-out method?
The Effect Of Prepaid Taxes On Assets And Liabilities
Many businesses estimate tax liability and make payments throughout the year (often quarterly). When a company overestimates its tax liability, this results in the business paying a prepaid tax. Prepaid taxes will be reversed within one year but can result in prepaid assets and liabilities.
Final Accounts
Financial accounting is one of the branches of accounting in which the transactions arising in the business over a particular period are recorded.
Ledger Posting
A ledger is an account that provides information on all the transactions that have taken place during a particular period. It is also known as General Ledger. For example, your bank account statement is a general ledger that gives information about the amount paid/debited or received/ credited from your bank account over some time.
Trial Balance and Final Accounts
In accounting we start with recording transaction with journal entries then we make separate ledger account for each type of transaction. It is very necessary to check and verify that the transaction transferred to ledgers from the journal are accurately recorded or not. Trial balance helps in this. Trial balance helps to check the accuracy of posting the ledger accounts. It helps the accountant to assist in preparing final accounts. It also helps the accountant to check whether all the debits and credits of items are recorded and posted accurately. Like in a balance sheet debit and credit side should be equal, similarly in trial balance debit balance and credit balance should tally.
Adjustment Entries
At the end of every accounting period Adjustment Entries are made in order to adjust the accounts precisely replicate the expenses and revenue of the current period. It is also known as end of period adjustment. It can also be referred as financial reporting that corrects the errors made previously in the accounting period. The basic characteristics of every adjustment entry is that it affects at least one real account and one nominal account.
Beginning inventory, purchases, and sales data for prepaid cell phones for May are as follows:
| Inventory | Purchases | Sales | |||
| May 1 | 4,200 units at $35 | May 10 | 2,100 units at $37 | May 12 | 2,940 units |
| May 20 | 1,890 units at $39 | May 14 | 2,520 units | ||
| May 31 | 1,260 units |
a. Assuming that the perpetual inventory system is used, costing by the LIFO method, determine the cost of merchandise sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 4. Under LIFO, if units are in inventory at two different costs, enter the units with the HIGHER unit cost first in the Cost of Merchandise Sold Unit Cost column and LOWER unit cost first in the Inventory Unit Cost column.
| Date | Quantity Purchased | Purchases Unit Cost | Purchases Total Cost | Quantity Sold | Cost of Merchandise Sold Unit Cost | Cost of Merchandise Sold Total Cost | Inventory Quantity | Inventory Unit Cost | Inventory Total Cost |
| May 1 | fill in the blank a0cf470d4fcf014_1 | $fill in the blank a0cf470d4fcf014_2 | $fill in the blank a0cf470d4fcf014_3 | ||||||
| May 10 | fill in the blank a0cf470d4fcf014_4 | $fill in the blank a0cf470d4fcf014_5 | $fill in the blank a0cf470d4fcf014_6 | fill in the blank a0cf470d4fcf014_7 | fill in the blank a0cf470d4fcf014_8 | fill in the blank a0cf470d4fcf014_9 | |||
| fill in the blank a0cf470d4fcf014_10 | fill in the blank a0cf470d4fcf014_11 | fill in the blank a0cf470d4fcf014_12 | |||||||
| May 12 | fill in the blank a0cf470d4fcf014_13 | $fill in the blank a0cf470d4fcf014_14 | $fill in the blank a0cf470d4fcf014_15 | fill in the blank a0cf470d4fcf014_16 | fill in the blank a0cf470d4fcf014_17 | fill in the blank a0cf470d4fcf014_18 | |||
| fill in the blank a0cf470d4fcf014_19 | fill in the blank a0cf470d4fcf014_20 | fill in the blank a0cf470d4fcf014_21 | |||||||
| May 14 | fill in the blank a0cf470d4fcf014_22 | fill in the blank a0cf470d4fcf014_23 | fill in the blank a0cf470d4fcf014_24 | fill in the blank a0cf470d4fcf014_25 | fill in the blank a0cf470d4fcf014_26 | fill in the blank a0cf470d4fcf014_27 | |||
| May 20 | fill in the blank a0cf470d4fcf014_28 | fill in the blank a0cf470d4fcf014_29 | fill in the blank a0cf470d4fcf014_30 | fill in the blank a0cf470d4fcf014_31 | fill in the blank a0cf470d4fcf014_32 | fill in the blank a0cf470d4fcf014_33 | |||
| fill in the blank a0cf470d4fcf014_34 | fill in the blank a0cf470d4fcf014_35 | fill in the blank a0cf470d4fcf014_36 | |||||||
| May 31 | fill in the blank a0cf470d4fcf014_37 | fill in the blank a0cf470d4fcf014_38 | fill in the blank a0cf470d4fcf014_39 | fill in the blank a0cf470d4fcf014_40 | fill in the blank a0cf470d4fcf014_41 | fill in the blank a0cf470d4fcf014_42 | |||
| fill in the blank a0cf470d4fcf014_43 | fill in the blank a0cf470d4fcf014_44 | fill in the blank a0cf470d4fcf014_45 | |||||||
| May 31 | Balances | $fill in the blank a0cf470d4fcf014_46 | $fill in the blank a0cf470d4fcf014_47 |
b. Based upon the preceding data, would you expect the inventory to be higher or lower using the first-in, first-out method?
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