Requirements: How much are the ending inventory and cost of sales,respectively, under the average cost method? How much are the ending inventory and cost of sales,respectively, under the FIFO method?
Thursday Co. is estimating the cost of its inventory at month-end. the accountant determined the following:
cost retail
inventory beg. $20,000 $ 75,000
Purchases 110,600 110,600
Freight in 4,000
Purchase discounts 1,000
Purchase returns 10,400 17,200
Departamental Transfers- in 2,000 3,000
Departamental Thansfers-out 1,600 2,400
markups 12,000
Markups cancellation 4,000
Markdowns 24,000
Markdowns cancellations 6,000
Additional information:
- A loss of $10,000 was recognized during the period for damaged goods. The goods have a retail value of $14,000.
- Gross sales for the period amounted to $ 87,600. Sales returns and discount amounted to $ 5,000 and $2,000, respectively. Employees discounts, treated as outright deduction to sael price, amounted to $1,000.
- Normal spoilage of $400 was subsumed to cost of sales.
Requirements:
How much are the ending inventory and cost of sales,respectively, under the average cost method?
How much are the ending inventory and cost of sales,respectively, under the FIFO method?
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
