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Determine cost of goods sold and ending inventory using FIFO, LIFO, and average-cost with analysis. P6-2A Mullins Distribution markets CDs of numerous performing artists. At the begin- ning of March, Mullins had in beginning inventory 2,500 CDs with a unit cost of $7. Dur- ing March, Mullins made the following purchases of CDs. March 5 2,000 @ $8 3,500 @ $9 March 21 5,000 @ $10 (LO 2), AP 2,000 @ $11 XLS March 13 March 26 During March 12,000 units were sold. Mullins uses a periodic inventory system. (b) Cost of goods sold: FIFO LIFO Instructions (a) Determine the cost of goods available for sale. (b) 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 $105,000 $115,500 $109,601 Average Problems: Set A cost of goods sold under the FIFO and LIFO methods. (Note: For average-cost, round cost per unit to three decimal places.) (c) 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?

Determine cost of goods sold and ending inventory using FIFO, LIFO, and average-cost with analysis. P6-2A Mullins Distribution markets CDs of numerous performing artists. At the begin- ning of March, Mullins had in beginning inventory 2,500 CDs with a unit cost of $7. Dur- ing March, Mullins made the following purchases of CDs. March 5 2,000 @ $8 3,500 @ $9 March 21 5,000 @ $10 (LO 2), AP 2,000 @ $11 XLS March 13 March 26 During March 12,000 units were sold. Mullins uses a periodic inventory system. (b) Cost of goods sold: FIFO LIFO Instructions (a) Determine the cost of goods available for sale. (b) 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 $105,000 $115,500 $109,601 Average Problems: Set A cost of goods sold under the FIFO and LIFO methods. (Note: For average-cost, round cost per unit to three decimal places.) (c) 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?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Determine cost of goods sold and ending inventory using FIFO, LIFO, and average-cost with analysis. P6-2A Mullins Distribution markets CDs of numerous performing artists. At the begin- ning of March, Mullins had in beginning inventory 2,500 CDs with a unit cost of $7. Dur- ing March, Mullins made the following purchases of CDs. March 5 2,000 @ $8 3,500 @ $9 March 21 5,000 @ $10 (LO 2), AP 2,000 @ $11 XLS March 13 March 26 During March 12,000 units were sold. Mullins uses a periodic inventory system. (b) Cost of goods sold: FIFO LIFO Instructions (a) Determine the cost of goods available for sale. (b) 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 $105,000 $115,500 $109,601 Average Problems: Set A cost of goods sold under the FIFO and LIFO methods. (Note: For average-cost, round cost per unit to three decimal places.) (c) 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?
Transcribed Image Text:Determine cost of goods sold and ending inventory using FIFO, LIFO, and average-cost with analysis. P6-2A Mullins Distribution markets CDs of numerous performing artists. At the begin- ning of March, Mullins had in beginning inventory 2,500 CDs with a unit cost of $7. Dur- ing March, Mullins made the following purchases of CDs. March 5 2,000 @ $8 3,500 @ $9 March 21 5,000 @ $10 (LO 2), AP 2,000 @ $11 XLS March 13 March 26 During March 12,000 units were sold. Mullins uses a periodic inventory system. (b) Cost of goods sold: FIFO LIFO Instructions (a) Determine the cost of goods available for sale. (b) 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 $105,000 $115,500 $109,601 Average Problems: Set A cost of goods sold under the FIFO and LIFO methods. (Note: For average-cost, round cost per unit to three decimal places.) (c) 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?
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