Perpetual Inventory System refers to the inventory system that maintains the detailed records of every inventory transactions related to purchases, and sales on a continuous basis. It shows the exact on-hand-inventory at any point of time. FIFO : In First-in-First-Out method, items purchased initially are sold first. So, the value of the ending inventory consists the recent cost for the remaining unsold items. LIFO : In Last-in-First-Out method, items purchased recently are sold first. So, the value of the ending inventory consists the initial cost for the remaining unsold items. Moving -average cost method: Under moving average cost method company calculates a new average after every purchases made. It is determined by dividing the cost of goods available for sale by the units on hand. To Calculate: The cost of ending inventory, and the cost of goods sold for each cost flow using perpetual inventory system.

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Answer 1

Question

Chapter 6, Problem 6.12E

(a)

To determine

Perpetual Inventory System refers to the inventory system that maintains the detailed records of every inventory transactions related to purchases, and sales on a continuous basis. It shows the exact on-hand-inventory at any point of time.

FIFO: In First-in-First-Out method, items purchased initially are sold first. So, the value of the ending inventory consists the recent cost for the remaining unsold items.

LIFO: In Last-in-First-Out method, items purchased recently are sold first. So, the value of the ending inventory consists the initial cost for the remaining unsold items.

Moving -average cost method: Under moving average cost method company calculates a new average after every purchases made. It is determined by dividing the cost of goods available for sale by the units on hand.

To Calculate: The cost of ending inventory, and the cost of goods sold for each cost flow using perpetual inventory system.

(b)

To determine

To Explain: The difference between the results of problem E6-7 and E6-14.

(c)

To determine

To explain: The reason for the average cost.

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Answer 2

Question

Chapter 6, Problem 6.12E

(a)

To determine

Perpetual Inventory System refers to the inventory system that maintains the detailed records of every inventory transactions related to purchases, and sales on a continuous basis. It shows the exact on-hand-inventory at any point of time.

FIFO: In First-in-First-Out method, items purchased initially are sold first. So, the value of the ending inventory consists the recent cost for the remaining unsold items.

LIFO: In Last-in-First-Out method, items purchased recently are sold first. So, the value of the ending inventory consists the initial cost for the remaining unsold items.

Moving -average cost method: Under moving average cost method company calculates a new average after every purchases made. It is determined by dividing the cost of goods available for sale by the units on hand.

To Calculate: The cost of ending inventory, and the cost of goods sold for each cost flow using perpetual inventory system.

(b)

To determine

To Explain: The difference between the results of problem E6-7 and E6-14.

(c)

To determine

To explain: The reason for the average cost.

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Answer 3

Question

Chapter 6, Problem 6.12E

(a)

To determine

Perpetual Inventory System refers to the inventory system that maintains the detailed records of every inventory transactions related to purchases, and sales on a continuous basis. It shows the exact on-hand-inventory at any point of time.

FIFO: In First-in-First-Out method, items purchased initially are sold first. So, the value of the ending inventory consists the recent cost for the remaining unsold items.

LIFO: In Last-in-First-Out method, items purchased recently are sold first. So, the value of the ending inventory consists the initial cost for the remaining unsold items.

Moving -average cost method: Under moving average cost method company calculates a new average after every purchases made. It is determined by dividing the cost of goods available for sale by the units on hand.

To Calculate: The cost of ending inventory, and the cost of goods sold for each cost flow using perpetual inventory system.

(b)

To determine

To Explain: The difference between the results of problem E6-7 and E6-14.

(c)

To determine

To explain: The reason for the average cost.

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Answer 4

Question

Chapter 6, Problem 6.12E

(a)

To determine

Perpetual Inventory System refers to the inventory system that maintains the detailed records of every inventory transactions related to purchases, and sales on a continuous basis. It shows the exact on-hand-inventory at any point of time.

FIFO: In First-in-First-Out method, items purchased initially are sold first. So, the value of the ending inventory consists the recent cost for the remaining unsold items.

LIFO: In Last-in-First-Out method, items purchased recently are sold first. So, the value of the ending inventory consists the initial cost for the remaining unsold items.

Moving -average cost method: Under moving average cost method company calculates a new average after every purchases made. It is determined by dividing the cost of goods available for sale by the units on hand.

To Calculate: The cost of ending inventory, and the cost of goods sold for each cost flow using perpetual inventory system.

(b)

To determine

To Explain: The difference between the results of problem E6-7 and E6-14.

(c)

To determine

To explain: The reason for the average cost.

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Answer 5

Chapter 6, Problem 6.12E

(a)

To determine

Perpetual Inventory System refers to the inventory system that maintains the detailed records of every inventory transactions related to purchases, and sales on a continuous basis. It shows the exact on-hand-inventory at any point of time.

FIFO: In First-in-First-Out method, items purchased initially are sold first. So, the value of the ending inventory consists the recent cost for the remaining unsold items.

LIFO: In Last-in-First-Out method, items purchased recently are sold first. So, the value of the ending inventory consists the initial cost for the remaining unsold items.

Moving -average cost method: Under moving average cost method company calculates a new average after every purchases made. It is determined by dividing the cost of goods available for sale by the units on hand.

To Calculate: The cost of ending inventory, and the cost of goods sold for each cost flow using perpetual inventory system.

(b)

To determine

To Explain: The difference between the results of problem E6-7 and E6-14.

(c)

To determine

To explain: The reason for the average cost.

Answer 6

Chapter 6, Problem 6.12E

(a)

To determine

Perpetual Inventory System refers to the inventory system that maintains the detailed records of every inventory transactions related to purchases, and sales on a continuous basis. It shows the exact on-hand-inventory at any point of time.

FIFO: In First-in-First-Out method, items purchased initially are sold first. So, the value of the ending inventory consists the recent cost for the remaining unsold items.

LIFO: In Last-in-First-Out method, items purchased recently are sold first. So, the value of the ending inventory consists the initial cost for the remaining unsold items.

Moving -average cost method: Under moving average cost method company calculates a new average after every purchases made. It is determined by dividing the cost of goods available for sale by the units on hand.

To Calculate: The cost of ending inventory, and the cost of goods sold for each cost flow using perpetual inventory system.

Answer 7

Chapter 6, Problem 6.12E

(a)

To determine

Perpetual Inventory System refers to the inventory system that maintains the detailed records of every inventory transactions related to purchases, and sales on a continuous basis. It shows the exact on-hand-inventory at any point of time.

FIFO: In First-in-First-Out method, items purchased initially are sold first. So, the value of the ending inventory consists the recent cost for the remaining unsold items.

LIFO: In Last-in-First-Out method, items purchased recently are sold first. So, the value of the ending inventory consists the initial cost for the remaining unsold items.

Moving -average cost method: Under moving average cost method company calculates a new average after every purchases made. It is determined by dividing the cost of goods available for sale by the units on hand.

To Calculate: The cost of ending inventory, and the cost of goods sold for each cost flow using perpetual inventory system.

Answer 8

(b)

To determine

To Explain: The difference between the results of problem E6-7 and E6-14.

Answer 9

(b)

To determine

To Explain: The difference between the results of problem E6-7 and E6-14.

Answer 10

(c)

To determine

To explain: The reason for the average cost.

Answer 11

(c)

To determine

To explain: The reason for the average cost.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 6 - The key to successful business operations is...Ch. 6 - Prob. 2Q Ch. 6 - What is just-in-time inventory management? What...Ch. 6 - Prob. 4Q Ch. 6 - Prob. 5Q Ch. 6 - Prob. 6Q Ch. 6 - Prob. 7Q Ch. 6 - Prob. 8Q Ch. 6 - What is the major advantage and major disadvantage...Ch. 6 - The selection of an inventory cost flow method is...

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To Explain: The difference between the results of problem E6-7 and E6-14.

To explain: The reason for the average cost.

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