Using FIFO method, calculate (i) cost of goods sold, (ii) ending inventory, and (ii) gross profit. (Assume sales returns had a cost of $21 and purchase returns had a cost of $24.) Cost of goods sold Ending Inventory Gross Profit Using Average method, calculate (i) cost of goods sold, (ii) ending inventory, and (iii gross profit. (Round average cost to 3 decimal places, eg. 5.252 and final answers to 2 decimal places, eg 5.25.) Cost of goods sold Ending Inventory $ Gross Profit Compare results for the two cost formulas. (1) Ina period of rising costs, the average cost formula results in the cost of goods sold and gross (2) In period of rising costs, on the statement of financial position, FIFO gives the ending inventory (representir %24 %24 %24 %24 %24 %24
Using FIFO method, calculate (i) cost of goods sold, (ii) ending inventory, and (ii) gross profit. (Assume sales returns had a cost of $21 and purchase returns had a cost of $24.) Cost of goods sold Ending Inventory Gross Profit Using Average method, calculate (i) cost of goods sold, (ii) ending inventory, and (iii gross profit. (Round average cost to 3 decimal places, eg. 5.252 and final answers to 2 decimal places, eg 5.25.) Cost of goods sold Ending Inventory $ Gross Profit Compare results for the two cost formulas. (1) Ina period of rising costs, the average cost formula results in the cost of goods sold and gross (2) In period of rising costs, on the statement of financial position, FIFO gives the ending inventory (representir %24 %24 %24 %24 %24 %24
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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
Transcribed Image Text:Concord Inc. is a retailer using a perpetual inventory system. All sales returns from customers result in the goods being returned to
inventory. (Assume that the inventory is not damaged.) Assume that there are no credit transactions; all amounts are settled in cash.
You are provided with the following information for Concord Inc. for the month of January.
Unit Cost or
Date
Description
Quantity
Selling Price
Dec. 31
Beginning inventory
160
$21
Jan.
2
Purchase
100
22
Jan.
6
Sale
180
40
Jan
9
Sale return
10
40
Jan.
9
Purchase
75
24
Jan.
10
Purchase return
15
24
Jan.
10
Sale
50
45
Jan.
23
Purchase
100
26
Jan.
30
Sale
120
51
Using FIFO method, calculate (i) cost of goods sold, (ii) ending inventory, and (iii) gross profit. (Assume sales returns had a cost of
$21 and purchase returns had a cost of $24.)
Cost of goods sold
2$
Ending Inventory
24
Gross Profit
24
Using Average method, calculate (i) cost of goods sold, (ii) ending inventory, and (iii) gross profit. (Round average cost to 3 decimal
places, e.g. 5.252 and final answers to 2 decimal places, e.g 5.25.)
Cost of goods sold
$
Ending Inventory
$
Gross Profit
$
Compare results for the two cost formulas.
(1)
In a period of rising costs, the average cost formula results in the
cost of goods sold and
gross
(2)
In period of rising costs, on the statement of financial position, FIFO gives the
ending inventory (representir
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