Mower-Blower Sales Co. started business on January 20, 2016.Products sold were snow blowers and lawn mowers.Each product sold for $1,400.Purchases during 2016 were as follows:BlowersMowersJanuary 2120@$800February 340 @780February 2830760March 1320 @ 760April 620@$840May 2240860June 340 @880June 2060920August 1520860September 2020840November 720@800The December 31, 2016 inventory included 10 blowers and 25 mowers.Assume the company uses a periodic inventory system.Required:Compute ending inventory valuation at December 31, 2016 under:a) FIFOb) LIFO(Hint: Compute ending inventory under each method, and then compareresults.)

LIFO (Last-In, First-Out)LIFO assumes that the most recent inventory items are sold first.…

Answered: Mower-Blower Sales Co. started business…

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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Mower-Blower Sales Co. started business on January 20, 2019. Products sold were snow blowers and lawn mowers. Each product sold for $350. Purchases during 2019 were as follows: January 21 February 3 February 28 March 13 April 6 May 22 June 3 June 20 August 15 September 20 November 7 Blowers Mowers O Yes O No Blowers 15@ $ 205 420 193 33 194 25@ 187 The December 31, 2019, Inventory Included 10 blowers and 25 mowers. Assume the company uses a periodic Inventory system. Required: a-1. Compute ending Inventory valuation at December 31, 2019, under the FIFO and LIFO cost flow assumptions. FIFO 23@ 295 O LIFO O FIFO Mowers 28@ $215 31@ 216 37@ 215 63@ 227 20@ 216 20@ 215 LIFO a-2. Is there any difference in valuation under FIFO and LIFO. b. If the cost of mowers had increased to $244 each by December 1, and if management had purchased 30 mowers at that time and if It wants to minimize taxes, which cost flow assumption was probably being used by the firm?
Linden Inc. purchased 10 merchandise inventory items at a total cost of $4,000 to add to its inventory on February 21, 2015. It started the month with 10 items at a total cost of $3,000. If the company used FIFO, what is the cost of goods sold if it sold 11 items in February. a. $3,850 b. $3,400 c. $3,500 d. $4,000
Garfunkle Company had the following four transactions during January 2017:
Tool Depot sells the latest selection of power tools and uses a perpetual inventory system. The following is information on the purchases and sales of the power drills, "M1500." On November 1, Tool Depot had 150 units with a unit cost of $49. Date Nov. 4 Nov. 6 Nov. 16 Nov. 20 Nov. 24 Nov. 28 Nov. 30 Units 200 350 150 Purchases Unit Cost 47 45 40 Units 100 275 250 100 Sales Unit Price $100 $100 $110 $110 Required 1. Calculate the dollar value of ending inventory and cost of goods sold using FIFO
Esperado Furnishings are retailers who purchase and sell household furnishings, including table lamps. The business uses a perpetual inventory system and adjusts cost of goods sold for any shortage or excess inventory. The business began the last quarter of 2018 with merchandise inventory of 10 pairs of “Italia” table lamps at a total cost of $168,200. The following transactions, relating to the “Italia” brand were completed during the quarter: October 5 Purchased 15 pairs of lamps at a cost of $17,020 per pair. October 14 Sold 18 pairs of lamps to Muller Furnishings at $22,250 per pair October 22 Purchased 24 pairs at a cost of $18,175 per pair but the supplier gave a 4% quantity discount. November 10 Sold 15 pairs of lamps to Orion Household Ltd and 10 pairs to Brown’s Furnishings which yielded total sales revenue of $589,750. November 12 Owing to an increased demand for this product, 30 pairs of lamps were purchased on account at a cost of $17,612 per pair. In addition, Esperado…
The following is a record of Ensberg Company's transactions for Colt Products for the month of May 2017. May 1 Balance 12 28 600 units@ $10.00 May 10 Sale Purchase 900 units@ $12.00 20 Purchase 600 units@ $15.00 450 units @ $19 Sale 810 units @ $19 (a) Assuming that perpetual inventories are not maintained and that a physical count at the end of the month shows 840 units on hand, what is the cost of the ending inventory using (1) FIFO and (2) LIFO? (b) Assuming that perpetual records are maintained and they tie into the general ledger, calculate the ending inventory using (1) FIFO and (2) LIFO.
Harry Gryffindor incorporated Harry's Pottery on March 1, 20x7. Harry's Pottery is a merchandising company located in Hogwarts Station, MD. During his first month of operations Harry reported the following data related to his purchases for his only product: In addition, Harry made one sale on March 15 when he sold 28 customized cauldrons to Rowena Ravenclaw for $50 each. Purchases on March 7 Purchases on March 14 Purchases on March 21 Harry Gryffindor made one sale on March 15 when he sold 28 customized cauldrons to Rowena Ravenclaw for $50 each. Assuming that Harry uses a perpetual inventory system, use the information provided above to calculate ending inventory on March 30 if Harry uses the weighted average method to assign costs to inventory. (Round your per unit costs to 2 decimal places.) Weighted Average - Perpetual: Date March 7 March 14 Average cost March 15 March 21 Average cost # of units Goods purchased Cost per unit 18 @ $20.00 32 @ $30.00 28 @ $36.00 18 units @ $20.00…
The following is a record of Ensberg Company's transactions for Colt Products for the month of May 2017. May 1 Balance 12 28 600 units@ $10.00 May 10 Purchase 900 units@ $12.00 20 Purchase 600 units@ $15.00 Sale 450 units @ $19 Sale 810 units @ $19 (a) Assuming that perpetual inventories are not maintained and that a physical count at the end of the month shows 840 units on hand, what is the cost of the ending inventory using (1) FIFO and (2) LIFO? (b) Assuming that perpetual records are maintained and they tie into the general ledger, calculate the ending inventory using (1) FIFO and (2) LIFO. Tom Terry manufactures an intricately detailed plastic and metal toy airplane. The following unit cost data pertain to the unit cost of an airplane: Direct materials Direct labor $ 5.00 12.00 Manufacturing overhead (50% fixed) 10.00 Total manufacturing costs $27.00 Assume that the airplane can be purchased from an outside supplier. What is the relevant unit cost for this make-or-buy decision? a.…
Required information (The following information applies to the questions displayed below.) The Shirt Shop had the following transactions for T-shirts for Year 1, its first year of operations. January 20 April 21 July 25 September 19 Purchased 4800 units es 8 Purchased 200 units e $10 Purchased 280 units @ $13 Purchased 90 units @ $15 $3, 200 2, e00 3,640 1,350 During the year, The Shirt Shop sold 810 T-shirts for $20 each. b. Record the above transactions in general journal form and post to T-accounts assuming (1) FIFO, (2) LIFO, and (3) weighted-average methods. Use a separate set of journal entries and T-accounts for each method. Assume all transactions are cash transactions.
can you please explain why they are multiplying by 220 in question 10 and also explain how they get the answer in question 11?
Luther has a bird shop that sells canaries. Luther maintains accurate records on the number of birds purchased from its suppliers and the number sold to customers. The records show the following purchases and sales during 2024. Date Transactions Units Unit Cost Total Cost January 1 Beginning inventory 33 $38 $1,254 April 14 Purchase 78 40 3, 120 August 22 Purchase 128 42 5, 376 October 29 Purchase 93 44 4,092 332 $13,842 January 1 to December 31 Sales ($58 each) 278 Luther uses a periodic inventory system and believes there are 54 birds remaining in ending inventory. However, Luther neglects to make a final inventory count at the end of the year. An employee accidentally left one of the cages open one night and 10 birds flew away, leaving only 44 birds in ending inventory. Luther is not aware of the lost canaries. 1. What amount will Luther calculate for ending inventory and cost of goods sold using FIFO, assuming he erroneously believes 54 canaries remain in ending inventory?
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