Jan. 1 Beginning inventory Jan. 10 Sales 225 units @ $11.00 = $ 2,475 150 units @ $41.00 Mar.14 Purchase Mar. 15 Sales 340 units @ $16.00 5,440 %3D 300 units @ $41.00 July30 Purchase Oct. 5 Sales 425 units @ $21.00 8,925 %3D Oct. 26 Purchase 395 units @ $41.00 125 units @ $26.00 3,250 Totals 1,115 units $20,090 845 units Exercise 5-8 Specific identification LO P1 Required: Hemming uses a perpetual inventory system. Assume that ending inventory is made up of 65 units from the March 14 purchase, 80 units from the July 30 purchase, and all 125 units from the October 26 purchase. Using the specific identification method, calculate th following. a) Cost of Goods Sold using Specific Identification Available for Sale Cost of Goods Sold Ending Inventory Ending Inventory Unit Cost Units Ending Inventory Cost Unit Units Sold Date Activity Units Unit Cost COGS Cost Jan. 1 Beginning Inventory $ 11.00 225 $ 11.00 225 $ 2,475 225 $ 11.00 24 2,475 Mar. 14 Purchase 340 $ 16.00 340 $ 16.00 5,440 45 $ 16.00 720 July 30 Purchase 425 $ 21.00 280 $ 21.00 5,880 145 $ 21.00 3,045 Oct. 26 Purchase 125 $ 26.00 125 $ 26.00 3,250 125 $ 26.00 3,250 1,115 970 $ 17,045 540 24 9,490 b) Gross Margin using Specific Identification Sales Less: Cost of goods sold Equals: Gross margin
Jan. 1 Beginning inventory Jan. 10 Sales 225 units @ $11.00 = $ 2,475 150 units @ $41.00 Mar.14 Purchase Mar. 15 Sales 340 units @ $16.00 5,440 %3D 300 units @ $41.00 July30 Purchase Oct. 5 Sales 425 units @ $21.00 8,925 %3D Oct. 26 Purchase 395 units @ $41.00 125 units @ $26.00 3,250 Totals 1,115 units $20,090 845 units Exercise 5-8 Specific identification LO P1 Required: Hemming uses a perpetual inventory system. Assume that ending inventory is made up of 65 units from the March 14 purchase, 80 units from the July 30 purchase, and all 125 units from the October 26 purchase. Using the specific identification method, calculate th following. a) Cost of Goods Sold using Specific Identification Available for Sale Cost of Goods Sold Ending Inventory Ending Inventory Unit Cost Units Ending Inventory Cost Unit Units Sold Date Activity Units Unit Cost COGS Cost Jan. 1 Beginning Inventory $ 11.00 225 $ 11.00 225 $ 2,475 225 $ 11.00 24 2,475 Mar. 14 Purchase 340 $ 16.00 340 $ 16.00 5,440 45 $ 16.00 720 July 30 Purchase 425 $ 21.00 280 $ 21.00 5,880 145 $ 21.00 3,045 Oct. 26 Purchase 125 $ 26.00 125 $ 26.00 3,250 125 $ 26.00 3,250 1,115 970 $ 17,045 540 24 9,490 b) Gross Margin using Specific Identification Sales Less: Cost of goods sold Equals: Gross margin
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Jan. 1 Beginning inventory
225 units @ $11.00
$ 2,475
%3D
Jan. 10 Sales
Mar. 14 Purchase
150 units@ $41.00
340 units @ $16.00 =
Mar. 15 Sales
5,440
July30 Purchase
300 units@ $41.00
425 units @ $21.00
8,925
%3D
Oct. 5 Sales
Oct. 26 Purchase
395 units @ $41.00
125 units @ $26.00
3,250
%3D
Totals
1,115 units
$20,090
845 units
Exercise 5-8 Specific identification LO P1
Required:
Hemming uses a perpetual inventory system. Assume that ending inventory is made up of 65 units from the March 14 purchase, 80
units from the July 30 purchase, and all 125 units from the October 26 purchase. Using the specific identification method, calculate the
following.
a) Cost of Goods Sold using Specific Identification
Available for Sale
Cost of Goods Sold
Ending Inventory
Ending
Inventory Unit Cost
Units
Ending
Inventory
Date
Activity
Units
Unit
Units
Unit Cost
COGS
Cost
Sold
Cost
Jan. 1
Beginning Inventory
225
$ 11.00
225
$ 11.00 $
2,475
225
$
11.00
$
2,475
Mar. 14
Purchase
340
$ 16.00
340
$ 16.00
5,440
45
$
16.00
720
July 30
Purchase
425
$ 21.00
280
$ 21.00
5,880
145
$21.00
3,045
Oct. 26
Purchase
125
$ 26.00
125
$ 26.00
3,250
125
$ 26.00
3,250
1,115
970
$17,045
540
9,490
b) Gross Margin using Specific Identification
Sales
Less:
Cost of goods sold
Equals:
Gross margin
%24
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