The image is a spreadsheet displaying inventory costing methods, particularly focusing on FIFO (First-In, First-Out). It includes tables and a financial summary.### Inventory Costing Methods#### Cost of Goods Sold- **Date:** Various dates in May.- **Item transactions:** - **1 May:** Beginning Inventory - 300 units at $17 each, Total $5,100.00 - **8 May Purchase:** 42 units at $19 each, Total $798.00 - **10 May Purchase:** 28 units at $20 each, Total $560.00 - **20 May Purchase:** 50 units at $22 each, Total $1,100.00#### FIFO Method- **Sold 135 Units @ $37 each:** - Total sales: Calculated for understanding cost flow.#### Income StatementThis section is highlighted in green:- **Sales:** - $1,400.00- **Cost of Goods Sold:** - Not explicitly stated.- **Gross Profit:** - The amount is not detailed but indicated by a border in the income statement section.- **Operating Expenses:** - Not specified.- **Net Income:** - Indicated with a line and assumed to be derived from the detailed figures.#### Additional Details- **Ending Inventory:** - Date of transactions and details of quantity and cost per unit. This document demonstrates how the FIFO method impacts financial statements by prioritizing inventory costs based on purchase date, affecting gross profit and net income calculation. The image displays a spreadsheet with financial data related to inventory and cost of goods sold (COGS). The spreadsheet appears to be set up for calculating average cost and includes the following elements:### Spreadsheet Layout:1. **Tabs:** - Sheet1 - Sheet2 - Sheet32. **Cost of Goods Sold (COGS) Section:** - **Columns:** - Date - Item - Quantity - Cost Per Unit - Total3. **LIFO Section:** - This section involves the Last-In, First-Out (LIFO) inventory valuation method, which affects how inventory costs are calculated.4. **Average Cost Section:** - **Highlighted Labels:** - "Average Cost Per Unit": Yellow - "Income Statement": Yellow - "Costs For E. Expenses (Operating Expenses)": Green - "Sales": Yellow - "Gross Profit" and "Net Income": Green5. **Financial Figures:** - "Net Income": $1,400.00 - "Gross Profit": Highlighted in Green - "Operating Expenses": Highlighted in Green 6. **Graphical Elements:** - There are color-coded sections for readability, with yellow and green highlights marking important financial headings.The spreadsheet is likely used to calculate inventory costs and assess profitability for a business using the average cost method. It involves financial statement components like Sales, COGS, Gross Profit, and Operating Expenses to compute Net Income.

FIFO is the abbreviation used for the First In First Out method: FIFO Date Item Quantity Cost per unit ($) Total ($) Sales Sale price Total Sales($) 01-May Beginning Inventory 30 17 510 30 at $37.00 each 1,110 08-May Purchase 28 18 504 28 at $37.00 each 1,036 15-May Purchase 42 19 798 42 at $37.00 each 1,554 22-May Purchase 10 22 220 10 at $37.00 each 370 29-May Purchase 50 26 1,300 25 at $37.00 each 925 135 4,995 Ending Inventory is $650 (25 units * $26) Particulars Amount ($) Opening Inventory 510 Purchases 2,822 Less: Ending Inventory -650 Cost of Goods Sold 2,682 Income Statement Sales 4,995 Cost of Goods Sold 2,682 Gross profit 2,313 Operating Expense 1,400 Net Income 913LIFO is the abbreviation used for the Last In First Out method: LIFO Date Item Quantity Cost per unit ($) Total ($) Sales Sale price Total ($) 01-May Beginning Inventory 30 17 510 5 at $37.00 each 185 08-May Purchase 28 18 504 28 at $37.00 each 1,036 15-May Purchase 42 19 798 42 at $37.00 each 1,554 22-May Purchase 10 22 220 10 at $37.00 each 370 29-May Purchase 50 26 1,300 50 at $37.00 each 1,850 135 4,995 Ending Inventory is $675 (25 units * $27) Particulars Amount ($) Opening Inventory 510 Purchases 2,822 Less: Ending Inventory -675 Cost of Goods Sold 2,657 Income Statement Sales 4,995 Cost of Goods Sold 2,657 Gross profit 2,338 Operating Expense 1,400 Net Income 938

Answered: Gross Profit %===>

Business

Accounting

Gross Profit %===>

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: What is Day's-sales-outstanding ratio?

A: Ratio analysis: The analysis of a company using the financial ratios and comparing its trends and…

Q: Which of the following ratios indicates the percentage of each sales dollar that is available to…

A: The objective of the question is to identify the correct ratio that indicates the percentage of each…

Q: Sheridan Bucket Co., a manufacturer of rain barrels, had the following data for 2021: Sales quantity…

A: Break-even sales is the point of unit sales where the net income is $0. Any sale above break-even…

Q: When Total Contribution magrin equals total fixed costs, this indicates operating income True…

A: If the contribution margin is equal to the total fixed cost that means it a situation of the…

Q: when total contribution margin equals total fixed cost this indicates operating income true false

A: First we understand contribution margin Contribution margin means Variable cost deduct from Sales…

Q: Which of the following items would not be found on a contribution format income statement?…

A: Cost-Volume-Profit analysis is the technique of managerial accounting, which examines that how…

Q: Sort the following contribution margin income statement line items in the correct order from top…

A: Operating income is calculated after deducting the variable costs and fixed costs from the total…

Q: The contribution margin ratio equals: Multiple Choice O Sales contribution margin. Sales variable…

A: The contribution margin takes into consideration variable expenses only.Contribution margin is the…

Q: am. 102.

A: APR stands for a) Annual Percentage Rate.

Q: Find: a. The maintained markup in dollars and percentages. b. The gross margin in dollars and…

A: Formulas used: Maintained Mark up $ = Gross Margin$ - Cash Discounts +Alternations Gross Margin $ =…

Q: 9. The point where the sales line and the total expense line intersects represents the A. profit…

A: Sales line: Sales line represents the sales incurred by the company over the specific period.…

Q: The three most common cost behavior classifications are a. variable costs, product costs, and sunk…

A: Cost volume profit analysis includes various techniques that help in the decision-making of the…

Q: The degree of operating leverage (DOL) is interpreted as the ratio of the percentage change in net…

Q: Which of the following breakeven points requires the minimum quantity of production? O gross profit…

A: Break-even quantity is the number of units to be produced to recover the expenses incrred. Now, this…

Q: Payback Period Modified Payback Period Net Present Value Profitability Index Accounting Rate of…

A: Here, we have to find these financial topics.

Q: Which one of the following is defined, at any given sales volume, as the ratio of the total…

A: Contribution margin is Sales less variable expenses at any given volume. Operating profit is…

Q: Malmo, Inc. manufactures travel locks. The budgeted selling price is $12 per lock, the variable cost…

A: Flexible budget means expected income and expenditure in future to find out budgeted income.…

Question

The image is a spreadsheet displaying inventory costing methods, particularly focusing on FIFO (First-In, First-Out). It includes tables and a financial summary.

### Inventory Costing Methods

#### Cost of Goods Sold

- **Date:** Various dates in May.
- **Item transactions:**
- **1 May:** Beginning Inventory - 300 units at $17 each, Total $5,100.00
- **8 May Purchase:** 42 units at $19 each, Total $798.00
- **10 May Purchase:** 28 units at $20 each, Total $560.00
- **20 May Purchase:** 50 units at $22 each, Total $1,100.00

#### FIFO Method
- **Sold 135 Units @ $37 each:**
- Total sales: Calculated for understanding cost flow.

#### Income Statement
This section is highlighted in green:

- **Sales:**
- $1,400.00
- **Cost of Goods Sold:**
- Not explicitly stated.
- **Gross Profit:**
- The amount is not detailed but indicated by a border in the income statement section.
- **Operating Expenses:**
- Not specified.
- **Net Income:**
- Indicated with a line and assumed to be derived from the detailed figures.

#### Additional Details
- **Ending Inventory:**
- Date of transactions and details of quantity and cost per unit.

This document demonstrates how the FIFO method impacts financial statements by prioritizing inventory costs based on purchase date, affecting gross profit and net income calculation.

The image displays a spreadsheet with financial data related to inventory and cost of goods sold (COGS). The spreadsheet appears to be set up for calculating average cost and includes the following elements:

### Spreadsheet Layout:

1. **Tabs:**
- Sheet1
- Sheet2
- Sheet3

2. **Cost of Goods Sold (COGS) Section:**
- **Columns:**
- Date
- Item
- Quantity
- Cost Per Unit
- Total

3. **LIFO Section:**
- This section involves the Last-In, First-Out (LIFO) inventory valuation method, which affects how inventory costs are calculated.

4. **Average Cost Section:**
- **Highlighted Labels:**
- "Average Cost Per Unit": Yellow
- "Income Statement": Yellow
- "Costs For E. Expenses (Operating Expenses)": Green
- "Sales": Yellow
- "Gross Profit" and "Net Income": Green

5. **Financial Figures:**
- "Net Income": $1,400.00
- "Gross Profit": Highlighted in Green
- "Operating Expenses": Highlighted in Green

6. **Graphical Elements:**
- There are color-coded sections for readability, with yellow and green highlights marking important financial headings.

The spreadsheet is likely used to calculate inventory costs and assess profitability for a business using the average cost method. It involves financial statement components like Sales, COGS, Gross Profit, and Operating Expenses to compute Net Income.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

FIFO method:

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Q2. Describe the components of the profit equation. ,
Markup is: Group of answer choices Selling price - cost Selling price divided by cost Selling price + cost Selling price × (1 + cost)
How do you find the maximum profit and loss percentage using these graphs? Long put Payoff Profe Kluss X short put Past/101/ pay off X
Answer full question
CM ratio = 1 ______ the Variable expense ratio. minus plus divided by multiplied by
The “plus” in cost-plus pricing is often referred to as Markup. Extra profit. Gross profit. Margin of Safety.
Change in operating income = change in sales dollars x contribution margin What is the equation for the "change in sales dollars"?