**Inventory Transactions and Cost Flow Assumptions at Mist, Inc.**Mist, Inc. uses a periodic inventory system and records the following transactions for one of its inventory items during 2020:**Beginning Inventory**- 124 units @ $50 per unit**Purchases**- Purchase 1 on 3/11/20: 75 units @ $52 per unit- Purchase 2 on 10/18/20: 94 units @ $54 per unit**Sales**- Sale 1 on 3/15/20: 110 units @ $79 per unit- Sale 2 on 10/22/20: 130 units @ $79 per unitNote:- All units sold on 3/15/20 were from the beginning inventory.- The 10/22/20 sale included 60 units from the 3/11/20 purchase and 70 units from the 10/18/20 purchase.**Objective:** To demonstrate how Mist’s Balance Sheet and Income Statement would differ under various inventory cost flow assumptions:- Specific Identification- First-In, First-Out (FIFO)- Last-In, First-Out (LIFO)- Weighted Average Cost.**Instructions:** Compute the Ending Inventory, Cost of Goods Sold (COGS), and Gross Profit under each method and fill in the table with your results.| | Specific Identification | First-In, First-Out | Last-In, First-Out | Weighted Average Cost ||---------------------------------------|-------------------------|---------------------|-------------------|-----------------------|| **12/31/20 Balance Sheet** | | | | || Ending Inventory | | | | || **2020 Income Statement** | | | | || Cost of Goods Sold | | | | || Gross Profit | | | | |Use calculations rounded to two decimal places where necessary.

Under periodic inventory system, ending inventory is valued and balance amount out of purchase is…

ist, InC. uses a tem alid nas the ToOV Beginning Inventory 124 units @ $50 per unit Purchases Purchase 1 on 3/11/20 75 units @ $52 per unit Purchase 2 on 10/18/20 94 units @ $54 per unit Sales Sale 1 on 3/15/20 110 units @ $79 per unit Sale 2 on 10/22/20 130 units @ $79 per unit All units sold on 3/15/20 were from beginning inventory. The 10/22/20 sale included 60 units from the 3/11/20 purchase and 70 units from the 10/18/20 purchase. Show how Mist's Balance Sheet and Income Statement would differ under each of the inventory cost flow assumptions. Compute Ending Inventory, COGS and Gross Profit under Specific Identification, Weighted Average Cost, FIFO and LIFO. Fill in your answers on the table. Specific Identification First-In, First-Out Last-In, First-Out Weighted Average Cost (round to 2 decimal places) 12/31/20 Balance Sheet Ending Inventory 2020 Income Statement Cost of Goods Sold Gross Profit

ist, InC. uses a tem alid nas the ToOV Beginning Inventory 124 units @ $50 per unit Purchases Purchase 1 on 3/11/20 75 units @ $52 per unit Purchase 2 on 10/18/20 94 units @ $54 per unit Sales Sale 1 on 3/15/20 110 units @ $79 per unit Sale 2 on 10/22/20 130 units @ $79 per unit All units sold on 3/15/20 were from beginning inventory. The 10/22/20 sale included 60 units from the 3/11/20 purchase and 70 units from the 10/18/20 purchase. Show how Mist's Balance Sheet and Income Statement would differ under each of the inventory cost flow assumptions. Compute Ending Inventory, COGS and Gross Profit under Specific Identification, Weighted Average Cost, FIFO and LIFO. Fill in your answers on the table. Specific Identification First-In, First-Out Last-In, First-Out Weighted Average Cost (round to 2 decimal places) 12/31/20 Balance Sheet Ending Inventory 2020 Income Statement Cost of Goods Sold Gross Profit

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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