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Laker Company reported the following January purchases and sales data for Its only product. For specific identification, ending Inventory consists of 280 units from the January 30 purchase, 5 units from the January 20 purchase, and 15 units from beginning Inventory. Date January 1 January 10 January 20 January 25 January 30 Activities Beginning inventory Sales Purchase Sales Purchase Totals sume the periodic Inventory system is used. quired: Units Acquired at Cost $7.00 = 190 units @ 110 units. @ 280 units @ 580 units $6.00 = $5.50 = $ 1,330 660 1,540 $3,530 Units sold at Retail 150 units 130 units 280 units @ @ $16.00 $ 16.00 1. Compute gross profit for the month of January for Laker Company for the four Inventory methods using the periodic Inventor system. 2. Which method yields the highest gross profit? 3. Does gross profit using weighted average fall between that using FIFO and LIFO?

Laker Company reported the following January purchases and sales data for Its only product. For specific identification, ending Inventory consists of 280 units from the January 30 purchase, 5 units from the January 20 purchase, and 15 units from beginning Inventory. Date January 1 January 10 January 20 January 25 January 30 Activities Beginning inventory Sales Purchase Sales Purchase Totals sume the periodic Inventory system is used. quired: Units Acquired at Cost $7.00 = 190 units @ 110 units. @ 280 units @ 580 units $6.00 = $5.50 = $ 1,330 660 1,540 $3,530 Units sold at Retail 150 units 130 units 280 units @ @ $16.00 $ 16.00 1. Compute gross profit for the month of January for Laker Company for the four Inventory methods using the periodic Inventor system. 2. Which method yields the highest gross profit? 3. Does gross profit using weighted average fall between that using FIFO and LIFO?

FINANCIAL ACCOUNTING
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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Required Information [The following information applies to the questions displayed below.] Laker Company reported the following January purchases and sales data for its only product. For specific identification, ending Inventory consists of 280 units from the January 30 purchase, 5 units from the January 20 purchase, and 15 units from beginning Inventory. Date January 1 January 10 January 20 January 25 January 30 ssume the periodic Inventory system is used. equired: Activities Beginning inventory Sales Purchase Sales Purchase Totals Units Acquired at Cost 190 units @ $ 7.00 = Req 1 110 units Sales Cost of goods sold Gross profit 280 units @ 580 units $6.00 = Complete this question by entering your answers in the tabs below. < Req 1 $5.50 = 3. Does gross profit using weighted average fall between that using FIFO and LIFO? 4. If costs were rising Instead of falling, which method would yield the highest gross profit? LAKER COMPANY For Month Ended January 31 Specific Identification Weighted Average $ 1,330 660 FIFO 1,540 $ 3,530 Req 2 to 4 > 1. Compute gross profit for the month of January for Laker Company for the four Inventory methods using the periodic Inventory system. 2. Which method yields the highest gross profit? Units sold at Retail 150 units LIFO 130 units Req 2 to 4 Jhm Compute gross proffor the month of January for Laker Company for the four inventory methods using the periodic inventory system. Note: Round cost per unit to 2 decimal places and final answers to the nearest whole dollars. 280 units @ @ $16.00 $ 16.00
Transcribed Image Text:Required Information [The following information applies to the questions displayed below.] Laker Company reported the following January purchases and sales data for its only product. For specific identification, ending Inventory consists of 280 units from the January 30 purchase, 5 units from the January 20 purchase, and 15 units from beginning Inventory. Date January 1 January 10 January 20 January 25 January 30 ssume the periodic Inventory system is used. equired: Activities Beginning inventory Sales Purchase Sales Purchase Totals Units Acquired at Cost 190 units @ $ 7.00 = Req 1 110 units Sales Cost of goods sold Gross profit 280 units @ 580 units $6.00 = Complete this question by entering your answers in the tabs below. < Req 1 $5.50 = 3. Does gross profit using weighted average fall between that using FIFO and LIFO? 4. If costs were rising Instead of falling, which method would yield the highest gross profit? LAKER COMPANY For Month Ended January 31 Specific Identification Weighted Average $ 1,330 660 FIFO 1,540 $ 3,530 Req 2 to 4 > 1. Compute gross profit for the month of January for Laker Company for the four Inventory methods using the periodic Inventory system. 2. Which method yields the highest gross profit? Units sold at Retail 150 units LIFO 130 units Req 2 to 4 Jhm Compute gross proffor the month of January for Laker Company for the four inventory methods using the periodic inventory system. Note: Round cost per unit to 2 decimal places and final answers to the nearest whole dollars. 280 units @ @ $16.00 $ 16.00
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