Ex. Clear Sound Audio uses a periodic inventory system. One of the store's most popular products is an MPS car stereo system. The inventory quantities, purchases, and sales of this product for the most recent year are as follows. Inventory, Jan. 1 First purchase (May 12) Second purchase (July 9) Third purchase (Oct. 4) Fourth purchase (Dec. 18) Goods available for sale Units sold during the year Inventory, Dec. 31 Number of Units 12 15 21 8 17 73 51 22 Cost per Unit $299 306 308 315 320 Total Cost $3,588 4,590 6,468 2,520 5,440 $22,606 Instructions a. Using periodic costing procedures, compute the cost of the December 31 inventory and the cost of goods sold for the MPS systems during the year under each of the following cost flow assumptions. 1. First-in, first-out. 2. Last-in, first-out. 3. Average cost (round to nearest dollar, except unit cost, and ignore small total rounding difference).
Ex. Clear Sound Audio uses a periodic inventory system. One of the store's most popular products is an MPS car stereo system. The inventory quantities, purchases, and sales of this product for the most recent year are as follows. Inventory, Jan. 1 First purchase (May 12) Second purchase (July 9) Third purchase (Oct. 4) Fourth purchase (Dec. 18) Goods available for sale Units sold during the year Inventory, Dec. 31 Number of Units 12 15 21 8 17 73 51 22 Cost per Unit $299 306 308 315 320 Total Cost $3,588 4,590 6,468 2,520 5,440 $22,606 Instructions a. Using periodic costing procedures, compute the cost of the December 31 inventory and the cost of goods sold for the MPS systems during the year under each of the following cost flow assumptions. 1. First-in, first-out. 2. Last-in, first-out. 3. Average cost (round to nearest dollar, except unit cost, and ignore small total rounding difference).
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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