Widget Tek Inc.'s original accountant accepted a position with another firm and left in earlyMarch. You have been asked to review the subsidiary inventory ledger record for Widget TekInc.'s main product for March. Inventory Date Quantity Unit Cost Total Cost Mar. 1 850 $98 $83,300 1,275 $95 $121, 125 Mar. 8 650 $98 $63, 700 Mar. 11 325 $98 $31, 850 Mar. 14 325 $98 $31,850 780 $103 $80, 340 Mar. 22 260 $98 $25, 480 Mar. 25 260 $98 $25, 480 1,900 $102$193,800 Study the inventory record for March and answer the questions that follow. 1.Assuming that the product sells for $150 and that 90% of sales are on account, determine thegross profit from sales for March. $fill in the blank 2. Making the same assumptions as in (1),determine the ending inventory cost for March. $fill in the blank 3. Which inventory method isbeing used?

Name: Widget Tek Inc.'s original accountant accepted a position with anothe
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Description: Widget Tek Inc.'s original accountant accepted a position with another firm and left in earlyMarch. You have been asked to review the subsidiary inventory ledger record for Widget TekInc.'s main product for March. Inventory Date Quantity Unit Cost T

It is the stock held for sale to customers. The inventory comprises of raw materials, work in…

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Widget Tek Inc.'s original accountant accepted a position with another firm and left in early March. You have been asked to review the subsidiary inventory ledger record for Widget Tek Inc.'s main product for March. Inventory Date Quantity Unit Cost Total Cost Mar. 1 850 $98 $ 83,300 1, 275 $95 $121, 125 Mar. 8 650 $98 $63, 700 Mar. 11 325 $98 $31, 850 Mar. 14 325 $ 98 $31, 850 780 $103 $80, 340 Mar. 22 260 $98 $25, 480 Mar. 25 260 $98 $25, 480 1,900 $102

Widget Tek Inc.'s original accountant accepted a position with another firm and left in early March. You have been asked to review the subsidiary inventory ledger record for Widget Tek Inc.'s main product for March. Inventory Date Quantity Unit Cost Total Cost Mar. 1 850 $98 $ 83,300 1, 275 $95 $121, 125 Mar. 8 650 $98 $63, 700 Mar. 11 325 $98 $31, 850 Mar. 14 325 $ 98 $31, 850 780 $103 $80, 340 Mar. 22 260 $98 $25, 480 Mar. 25 260 $98 $25, 480 1,900 $102

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.

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Widget Tek Inc.'s original accountant accepted a position with another firm and left in early
March. You have been asked to review the subsidiary inventory ledger record for Widget Tek
Inc.'s main product for March. Inventory Date Quantity Unit Cost Total Cost Mar. 1 850 $98 $
83,300 1,275 $95 $121, 125 Mar. 8 650 $98 $63, 700 Mar. 11 325 $98 $31, 850 Mar. 14 325 $
98 $31,850 780 $103 $80, 340 Mar. 22 260 $98 $25, 480 Mar. 25 260 $98 $25, 480 1,900 $102
$193,800 Study the inventory record for March and answer the questions that follow. 1.
Assuming that the product sells for $150 and that 90% of sales are on account, determine the
gross profit from sales for March. $fill in the blank 2. Making the same assumptions as in (1),
determine the ending inventory cost for March. $fill in the blank 3. Which inventory method is
being used?

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Step 3: Determine the gross profit from sales for March:

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