On January 1, 20x8, the Music Store had 400 MP3 players in inventory with a cost of $48 per unit. During 20x8 the company made the following purchases of MP3 players: Feb 21 Jun 15 Oct 15 1,000 units at $50 each = $50,000 1,000 units at $52 each = $52,000 1,000 units at $58 each = $58,000 The selling price of each MP3 player is $100. The store had an excellent Christmas season with the result that only 70 MP3 players were left in inventory on December 31, 20x8. Assuming the company uses a periodic inventory system, calculate gross profit for the year ending December 31, 20x8, under each of: i) FIFO; ii) Weighted Average

On January 1, 20x8, the Music Store had 400 MP3 players in inventory with a cost of $48 per unit. During 20x8 the company made the following purchases of MP3 players: Feb 21 Jun 15 Oct 15 1,000 units at $50 each = $50,000 1,000 units at $52 each = $52,000 1,000 units at $58 each = $58,000 The selling price of each MP3 player is $100. The store had an excellent Christmas season with the result that only 70 MP3 players were left in inventory on December 31, 20x8. Assuming the company uses a periodic inventory system, calculate gross profit for the year ending December 31, 20x8, under each of: i) FIFO; ii) Weighted Average

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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