The beginning inventory at Midnight Supplies and data on purchases and sales for a three month period ending March 31 are as follows: Date Transaction Number of Units Per Unit Total Jan. 1 Inventory 2,500 $70.00 $175,000 10 Purchase 8,000 78.00 624,000 28 Sale 3,800 140.00 532,000 30 Sale 1,250 140.00 175,000 Feb. 5 Sale 500 140.00 70,000 10 Purchase 17,000 80.00 1,360,000 16 Sale 9,100 145.00 1,319,500 28 Sale 8,700 145.00 1,261,500 Mar. 5 Purchase 14,300 81.60 1,166,880 14 Sale 9,800 145.00 1,421,000 25 Purchase 3,000 82.00 246,000 30 Sale 7,900 145.00 1,145,500 Instructions 1. Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the first-in, first-out method. 2. Determine the total sales and the total cost of goods sold for the period. Journalize the entries in the sales and cost of goods sold accounts. Assume that all sales were on account and date your journal entry March 31. Refer to the Chart of Accounts for exact wording of account titles. 3. Determine the gross profit from sales for the period. 4. Determine the ending inventory cost as of March 31. 5. Based upon the preceding data, would you expect the ending inventory using the last-in, first-out method to be higher or lower?

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter6: Inventories

Section: Chapter Questions

Problem 1PB: FIFO perpetual inventory The beginning inventory at Dunne Co. and data on purchases and sales for a...

See similar textbooks

Related questions

Concept explainers

Topic Video

Question

The beginning inventory at Midnight Supplies and data on purchases and sales for a three month period ending March 31 are as follows:

Date	Transaction	Number of Units	Per Unit	Total
Jan.	1	Inventory	2,500	$70.00	$175,000
	10	Purchase	8,000	78.00	624,000
	28	Sale	3,800	140.00	532,000
	30	Sale	1,250	140.00	175,000
Feb.	5	Sale	500	140.00	70,000
	10	Purchase	17,000	80.00	1,360,000
	16	Sale	9,100	145.00	1,319,500
	28	Sale	8,700	145.00	1,261,500
Mar.	5	Purchase	14,300	81.60	1,166,880
	14	Sale	9,800	145.00	1,421,000
	25	Purchase	3,000	82.00	246,000
	30	Sale	7,900	145.00	1,145,500

	Instructions
1.	Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the first-in, first-out method.
2.	Determine the total sales and the total cost of goods sold for the period. Journalize the entries in the sales and cost of goods sold accounts. Assume that all sales were on account and date your journal entry March 31. Refer to the Chart of Accounts for exact wording of account titles.
3.	Determine the gross profit from sales for the period.
4.	Determine the ending inventory cost as of March 31.
5.	Based upon the preceding data, would you expect the ending inventory using the last-in, first-out method to be higher or lower?

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 5 steps with 4 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions