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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 250 units from the January 30 purchase, 5 units from the January 20 purchase, and 20 units from beginning inventory. Date January 1 January 10 January 20 January 25 January 30 Activities Beginning inventory Sales Purchase Sales Purchase Totals Assume the perpetual inventory system is used. Required: Units Acquired at Cost 165 units @ $ 9.00 = 110 units @ 250 units @ 525 units $ 8.00 = $ 7.50 = $ 1,485 880 1,875 $ 4,240 Units sold at Retail 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? 125 units 125 units 250 units 1. Compute gross profit for the month of January for Laker Company for the four inventory methods. 2. Which method yields the highest gross profit? @ @ $ 18.00 $ 18.00

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 250 units from the January 30 purchase, 5 units from the January 20 purchase, and 20 units from beginning inventory. Date January 1 January 10 January 20 January 25 January 30 Activities Beginning inventory Sales Purchase Sales Purchase Totals Assume the perpetual inventory system is used. Required: Units Acquired at Cost 165 units @ $ 9.00 = 110 units @ 250 units @ 525 units $ 8.00 = $ 7.50 = $ 1,485 880 1,875 $ 4,240 Units sold at Retail 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? 125 units 125 units 250 units 1. Compute gross profit for the month of January for Laker Company for the four inventory methods. 2. Which method yields the highest gross profit? @ @ $ 18.00 $ 18.00

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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Req 1 Req 2 to 4 Compute gross profit for the month of January for Laker Company for the four inventory methods. Note: Round cost per unit to 2 decimal places and final answers to the nearest whole dollars. Sales Cost of goods sold Gross profit LAKER COMPANY For Month Ended January 31 Specific Identification $ 0 Weighted Average $ 0 $ FIFO 0 $ LIFO 0
Transcribed Image Text:Req 1 Req 2 to 4 Compute gross profit for the month of January for Laker Company for the four inventory methods. Note: Round cost per unit to 2 decimal places and final answers to the nearest whole dollars. Sales Cost of goods sold Gross profit LAKER COMPANY For Month Ended January 31 Specific Identification $ 0 Weighted Average $ 0 $ FIFO 0 $ LIFO 0
! 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 250 units from the January 30 purchase, 5 units from the January 20 purchase, and 20 units from beginning inventory. Date January 1 January 10 January 20 January 25 January 30 Activities Beginning inventory Sales Purchase Sales Purchase Totals Assume the perpetual inventory system is used. Required: Units Acquired at Cost 165 units @ $9.00 = $ 1,485 110 units @ $ 8.00 = 250 units @ $7.50 = 525 units 880 1,875 $ 4,240 Units sold at Retail 125 units 125 units 250 units 1. Compute gross profit for the month of January for Laker Company for the four inventory methods. 2. Which method yields the highest gross profit? 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? @ @ $ 18.00 $ 18.00
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 250 units from the January 30 purchase, 5 units from the January 20 purchase, and 20 units from beginning inventory. Date January 1 January 10 January 20 January 25 January 30 Activities Beginning inventory Sales Purchase Sales Purchase Totals Assume the perpetual inventory system is used. Required: Units Acquired at Cost 165 units @ $9.00 = $ 1,485 110 units @ $ 8.00 = 250 units @ $7.50 = 525 units 880 1,875 $ 4,240 Units sold at Retail 125 units 125 units 250 units 1. Compute gross profit for the month of January for Laker Company for the four inventory methods. 2. Which method yields the highest gross profit? 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? @ @ $ 18.00 $ 18.00
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