Scoresby Incorporated tracks the number of units purchased and sold throughout each year but applies its inventory costing method at the end of the year, as if it uses a periodic inventory system. Assume its accounting records provided the following information at the end of the annual accounting period, December 31. Transactions a. Inventory, Beginning For the year: b. Purchase, March 5 c. Purchase, September 19 d. Sale, April 15 (sold for $65 per unit) e. Sale, October 31 (sold for $68 per unit) f. Operating expenses (excluding income tax expense), $615,000 Required: 1. Calculate the number and cost of goods available for sale. 2. Calculate the number of units in ending inventory. Units 4,000 Unit Cost $ 20 10,000 21 6,000 23 4,500 9,000 23 3. Compute the cost of ending inventory and cost of goods sold under (a) FIFO, (b) LIFO, and (c) weighted average cost. 4. Prepare an income statement that shows the FIFO method, LIFO method and weighted average method. 6. Which inventory costing method minimizes income taxes? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 6 Calculate the number of units in ending inventory. Ending Inventory units < Required 1 Required 3>
Scoresby Incorporated tracks the number of units purchased and sold throughout each year but applies its inventory costing method at the end of the year, as if it uses a periodic inventory system. Assume its accounting records provided the following information at the end of the annual accounting period, December 31. Transactions a. Inventory, Beginning For the year: b. Purchase, March 5 c. Purchase, September 19 d. Sale, April 15 (sold for $65 per unit) e. Sale, October 31 (sold for $68 per unit) f. Operating expenses (excluding income tax expense), $615,000 Required: 1. Calculate the number and cost of goods available for sale. 2. Calculate the number of units in ending inventory. Units 4,000 Unit Cost $ 20 10,000 21 6,000 23 4,500 9,000 23 3. Compute the cost of ending inventory and cost of goods sold under (a) FIFO, (b) LIFO, and (c) weighted average cost. 4. Prepare an income statement that shows the FIFO method, LIFO method and weighted average method. 6. Which inventory costing method minimizes income taxes? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 6 Calculate the number of units in ending inventory. Ending Inventory units < Required 1 Required 3>
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Scoresby Incorporated tracks the number of units purchased and sold throughout each year but applies its inventory costing method
at the end of the year, as if it uses a periodic inventory system. Assume its accounting records provided the following information at
the end of the annual accounting period, December 31.
Transactions
a. Inventory, Beginning
For the year:
b. Purchase, March 5
c. Purchase, September 19
d. Sale, April 15 (sold for $65 per unit)
e. Sale, October 31 (sold for $68 per unit)
f. Operating expenses (excluding income tax expense), $615,000
Required:
1. Calculate the number and cost of goods available for sale.
2. Calculate the number of units in ending inventory.
Units
4,000
Unit Cost
$ 20
10,000
21
6,000
23
4,500
9,000
23
3. Compute the cost of ending inventory and cost of goods sold under (a) FIFO, (b) LIFO, and (c) weighted average cost.
4. Prepare an income statement that shows the FIFO method, LIFO method and weighted average method.
6. Which inventory costing method minimizes income taxes?
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Required 3 Required 4
Required 6
Calculate the number of units in ending inventory.
Ending Inventory
units
< Required 1
Required 3>
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