E 3-6 - Retail inventory method (Aver month of January: Beginning inventory at cost Beginning inventory at sales price Purchases at cost Initial markup on purchases Purchase returns at cost Purchase returns at sales price Freight on purchases Additional markup Markup cancellations Markdown Markdown cancellations Net sales Sales allowances Sales returns Employee discounts Theft and other losses P 440,000 800,000 4,500,000 2,900,000 240,000 350,000 100,000 250,000 100,000 600,000 100,000 6,500,000 100,000 500,000 200,000 100,000 Required: Compute the estimated cost of inventory at the end of the current ye. using: 1. Average retail inventory method

E 3-6 - Retail inventory method (Aver month of January: Beginning inventory at cost Beginning inventory at sales price Purchases at cost Initial markup on purchases Purchase returns at cost Purchase returns at sales price Freight on purchases Additional markup Markup cancellations Markdown Markdown cancellations Net sales Sales allowances Sales returns Employee discounts Theft and other losses P 440,000 800,000 4,500,000 2,900,000 240,000 350,000 100,000 250,000 100,000 600,000 100,000 6,500,000 100,000 500,000 200,000 100,000 Required: Compute the estimated cost of inventory at the end of the current ye. using: 1. Average retail inventory method

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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Inventory, January 1 Purchases Markups (net) Markdowns (net) Sales Required: Purchases ✓ Add: Markups (net) ✓ ✓ Less: Markdowns (net) Retail $35,000 $70,000 140,000 240,379 Cost-to-retail ratio: Beginning inventory Goods available for sale Less: Sales Ending inventory - ✓ Cost ✓ 1. Compute the ending inventory by the retail inventory method for the following cost flow assumption: FIFO. Round the cost-to-retail ratio to three decimal places. HARMES COMPANY Calculation of ending inventory by retail inventory method FIFO - ✔ - - 3,000 2,000 180,000 Cost 140,000 Retail $240,379 3,000 2,000 X COO 180,000
Perpetual Inventory Using FIFO Beginning inventory, purchases, and sales for Item Copper are as follows: Mar. 1 Inventory 450 units at $7 6. Sale 390 units 13 Purchase 410 units at $8 25 Sale 340 units Assuming a perpetual inventory system and using the first-in, first-out (FIFO) method, determine (a) the cost of merchandise sold on March 25 and (b) the inventory on March 31. a. Cost of merchandise sold on March 25 5,450 X b. Inventory on March 31 1,040 V Feedback Check My Work a. When the FIFO method is used, costs are included in cost of merchandise sold in the order in which they were purchased. Think of your inventory in terms of "layers." Determine how much inventory remains from each layer after each sale. b. The ending inventory is made up of the most recent purchases. 12:59 AM 10/24/2020 ort sc delete T UD backspace TUY Vock T home H. enter pause M ctri
Journalize each of the following transactions assuming a periodic inventory system and PST at 8% along with 5% GST. June 1 Purchased $3,800 of merchandise; terms 1/10, n/30. 5 Sold $2,800 of merchandise for $3,200; terms n/15. No 1 2 Date June 01 June 05 Purchases Accounts receivable Purchases Answer is not complete. General Journal 3 ** Debit 3,800 > Credit 3,360 2,800 **
Date January 1 April 7 July 16 October 6 Transaction Beginning inventory Purchase Purchase Purchase Req 1a and b Number of Units 52 132 202 112 498 For the entire year, the company sells 432 units of inventory for $62 each. Required: 1-a & b. Using FIFO, calculate ending inventory and cost of goods sold. 1-c & d. Using FIFO, calculate sales revenue and gross profit. 2-a & b. Using LIFO, calculate ending inventory and cost of goods sold. 2-c & d. Using LIFO, calculate sales revenue and gross profit. 3-a & b. Using weighted-average cost, calculate ending inventory and cost of goods sold. 3-c & d. Using weighted-average cost, calculate sales revenue and gross profit. 4. Determine which method will result in higher profitability when inventory costs are rising. Req 2a and b Req 1c and d Unit Cost Complete this question by entering your answers in the tabs below. $44 46 49 50 Req 3a and b Req 2c and d Using FIFO, calculate ending inventory and cost of goods sold. Cost of Goods Available for…
Beginning inventory Purchases Purchase returns Purchase discounts Gross sales revenue Sales returns Markups Cost Retail $248,900 $394,300 $1,005,985 $1,478,600 $60,700 $80,300 $18,300 $1,426,400 $97,850 $121,000 Markup cancellations $40,700 Markdowns $45,200 Markdown cancellations $25,250 Freight-in $41.500 Employee discounts granted $9,200 Loss from breakage (normal) $4,750 Based on the above information, determine the cost of ending inventory using conventional retail method $340,860 $331,793 $344,760 $323,789
FIFO Perpetual Inventory The beginning inventory of merchandise at Rhodes Co. and data on purchases and sales for a three-month period ending June 30 are as follows: Date Transaction Numberof Units Per Unit Total Apr. 3 Inventory 40 $670 $26,800 8 Purchase 120 690 82,800 11 Sale 60 1,120 67,200 30 Sale 50 1,120 56,000 May 8 Purchase 100 700 70,000 10 Sale 80 1,120 89,600 19 Sale 30 1,120 33,600 28 Purchase 120 707 84,840 June 5 Sale 60 1,260 75,600 16 Sale 40 1,260 50,400 21 Purchase 180 712 128,160 28 Sale 190 1,260 239,400 Required: 1. Record the inventory, purchases, and cost of merchandise sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the first-in, first-out method. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Merchandise Sold…
Cost Retail Inventory, 12/31/25 $254,700 $397,600 Purchases 1,002,796 1,454,100 Purchase returns 59,600 80,100 Purchase discounts 17,900 Gross sales revenue - Sales returns 1,423,100 95,600 Markups 119,500 Markup cancellations Markdowns Markdown cancellations 40,500 44,300 20,200 Freight-in 41,400 Employee discounts granted 8,000 Loss from breakage (normal) 4,200 Assuming that Cheyenne Inc. uses the conventional retail inventory method, compute the cost of its ending inventory at December 31, 2026. Ending inventory using the conventional retail inventory method $ 31158
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Date January 1 January 3 February 14 February 15 June 30 November 6 November 19 Activities Beginning inventory Sales Purchase. Sales Purchase. Sales Purchase. Totals FIFO Units Acquired at Cost 190 units 300 units Periodic Inventory System 240 units 80 units 810 units @ $2 = $380 @$3-$900 @ $4$ 960 @$5$400 $ 2,648 Required A Required B Required C Determine the costs assigned to ending inventory and to cost of goods sold using FIFO. Ending Cost of Inventory Goods Sold Units Sold at Retail 122 units @ $8 @ $8 @ $8 210 units The company uses a periodic inventory system. 1. Determine the costs assigned to ending inventory and to cost of goods sold using FIFO. 2. Determine the costs assigned to ending inventory and to cost of goods sold using LIFO. 3. Compute the gross profit for each method. Complete this question by entering your answers in the tabs below. 176 units 508 units
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