Concord Distribution markets CDs of the performing artist Fishe. At the beginning of October, Concord had in beginning inventory 2,500 of Fishe’s CDs with a unit cost of $7. During October, Concord made the following purchases of Fishe’s CDs. Oct. 3 3,125
Concord Distribution markets CDs of the performing artist Fishe. At the beginning of October, Concord had in beginning inventory 2,500 of Fishe’s CDs with a unit cost of $7. During October, Concord made the following purchases of Fishe’s CDs. Oct. 3 3,125
Century 21 Accounting Multicolumn Journal
11th Edition
ISBN:9781337679503
Author:Gilbertson
Publisher:Gilbertson
Chapter20: Accounting For Inventory
Section: Chapter Questions
Problem 1MP
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Question
Concord Distribution markets CDs of the performing artist Fishe. At the beginning of October, Concord had in beginning inventory 2,500 of Fishe’s CDs with a unit cost of $7. During October, Concord made the following purchases of Fishe’s CDs.
During October, 13,625 units were sold. Concord uses a periodic inventory system.
Oct. 3 | 3,125 | @ | $8 | Oct. 19 | 3,750 | @ | $10 | |||
Oct. 9 | 4,375 | @ | $9 | Oct. 25 | 5,000 | @ | $11 |
During October, 13,625 units were sold. Concord uses a periodic inventory system.
Determine the cost of goods available for sale.
Cost of goods available for sale |
?
|
Calculate weighted average cost per unit. (Round answer to 2 decimal places, e.g. 2.25.)
Weighted average cost per unit |
?
|
Determine (1) the ending inventory and (2) the cost of goods sold under each of the assumed cost flow methods (FIFO, LIFO, and average-cost). Prove the accuracy of the cost of goods sold under the FIFO and LIFO methods. (Round answers to 0 decimal places, e.g. 1,250. Use weighted-average unit cost rounded to 2 decimal places for computations.)
FIFO
|
LIFO
|
AVERAGE-COST
|
||||
The ending inventory |
$
|
$
|
$
|
|||
The cost of goods sold |
$
|
$
|
$
|
Which cost flow method results in (1) the highest inventory amount for the balance sheet and (2) the highest cost of goods sold for the income statement?
(1) | (FIFO, LIFO, or Average-cost) results in the highest inventory amount, $ ? | |
(2) | (FIFO, LIFO, or Average-cost) results in the highest cost of goods sold, $ ? |
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