December 31 under each of the following methods?
Chapter1: Financial Statements And Business Decisions
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How do you calculate the total amount to be assigned to the ending inventory and cost of goods sold December 31 under each of the following methods?

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Cost Allocation and Lower-of-Cost-or-Market
Douglas Company's beginning inventory and purchases during the fiscal year ended December 31, 20--, were as shown.
Units Unit Price Total Cost
January 1, 20-- Beginning inventory
1,110 $
8.00
088
8,100
March 5
1st purchase
900
9.00
April 16
2nd purchase
420
9.50
3,990
June 3
3rd purchase
720
10.20
7,344
August 18
4th purchase
600 10.90
6,540
September 13
5th purchase
780
11.90
9,282
November 14
6th purchase
380
13.80
5,244
December 3
7th purchase
480
13.85
6,648
5,390
S 56,028
There are 1.000 units of inventory on hand on December 31.
Required:
1. Calculate the total amount to be assigned to the ending inventory and cost of gdods sold on December 31 under each of the folc
Cost of Goods
Cost of Ending
Sold
Inventory
5,390
56,028
a. FIFO
121
44

Transcribed Image Text:There are 1,000 units of inventory on hand on December 31.
Required:
1. Calculate the total amount to be assigned to the ending inventory and cost of goods sold on December 31 under each of the following methods:
Cost of Goods
Cost of Ending
Sold
Inventory
a. FIFO
b. LIFO
c. Weighted-average (round calculations to two
decimal places)
2. Assume that the market price per unit (cost to replace) of Douglas's inventory on December 31 was $13. Calculate the total amount to be assigned to the ending invento
a. FIFO lower-of-cost-or-market
b. Weighted-average lower-of-cost-or-market
3. Prepare required entries to apply:
a. FIFO lower-of-cost-or-market
b. Weighted-average lower-of-cost-or-market
If no entry is required, select "No Entry Required".
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