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 $73 per unit) e. Salè, October 31 (sold for $76 per unit) f. Operating expenses (excluding income tax expense), $398,000 Required: 1. Calculate the number and cost of goods available for sale. 2. Calculate the number of units in ending inventory. 3. Compute the cost of ending inventory and cost of goods sold under (a) FIFO and (b) LIFO. 4. Prepare an income statement that shows the FIFO method and LIFO method. 5. 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 5 Calculate the number and cost of goods available for sale. Number of Goods Available for Sale Cost of Goods Available for Sale Required 1. Units 1,500 units 7,500 3,500 2,200 6,500 Required 2 > Unit Cost $28 29 31
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 $73 per unit) e. Salè, October 31 (sold for $76 per unit) f. Operating expenses (excluding income tax expense), $398,000 Required: 1. Calculate the number and cost of goods available for sale. 2. Calculate the number of units in ending inventory. 3. Compute the cost of ending inventory and cost of goods sold under (a) FIFO and (b) LIFO. 4. Prepare an income statement that shows the FIFO method and LIFO method. 5. 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 5 Calculate the number and cost of goods available for sale. Number of Goods Available for Sale Cost of Goods Available for Sale Required 1. Units 1,500 units 7,500 3,500 2,200 6,500 Required 2 > Unit Cost $28 29 31
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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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:
Complete this question by entering your answers in the tabs below.
b. Purchase, March 5
c. Purchase, September 19
d. Sale, April 15 (sold for $73 per unit)
e. Salé, October 31 (sold for $76 per unit)
f. Operating expenses (excluding income tax expense), $398,000
Required:
1. Calculate the number and cost of goods available for sale.
2. Calculate the number of units in ending inventory.
3. Compute the cost of ending inventory and cost of goods sold under (a) FIFO and (b) LIFO.
4. Prepare an income statement that shows the FIFO method and LIFO method.
5. Which inventory costing method minimizes income taxes?
Required 1 Required 2
Required 3
Required 4 Required 5
Calculate the number and cost of goods available for sale.
Number of Goods Available for Sale
Cost of Goods Available for Sale
Required 1
units
Units
1,500
Required 2
Unit Cost
$28
7,500
3,500
2,200
6,500
29
31
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