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. In First-in-First-Out method, the cost of initial purchased items are sold first. The value of the ending inventory consists the recent purchased items. In Last-in-First-Out method, the cost of last purchased items are sold first. The value of the closing stock consists the initial purchased items. In Average Cost Method the cost of inventory is priced at the average rate of the goods available for sale. Following is the mathematical representation: Weighted-average Cost = Total Cost of Goods Available For Sale Total Number of Units Available For Sale To Prepare: The perpetual inventory record for the merchandise inventory using the FIFO inventory costing method.

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Answer 1

Question

Chapter 6, Problem 6.29AP

1.

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.

In First-in-First-Out method, the cost of initial purchased items are sold first. The value of the ending inventory consists the recent purchased items.

In Last-in-First-Out method, the cost of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

In Average Cost Method the cost of inventory is priced at the average rate of the goods available for sale. Following is the mathematical representation:

Weighted-average Cost=Total Cost of Goods Available For SaleTotal Number of Units Available For Sale

To Prepare: The perpetual inventory record for the merchandise inventory using the FIFO inventory costing method.

2.

To determine

To Prepare: The perpetual inventory record for the merchandise inventory using the LIFO inventory costing method.

3.

To determine

To Prepare: The perpetual inventory record for the merchandise inventory using the weighted average inventory costing method.

4.

To determine

The Company’s cost of goods sold for August using FIFO, LIFO, and weighted-average inventory costing methods.

5.

To determine

To Compute: The gross profit for August using FIFO, LIFO, and weighted-average inventory costing method.

6.

To determine

To Explain: The method that the company should use to maximize gross profit.

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Dharma Chemical Inc. placed 195,000 liters of direct materials into the mixing process. At the end of the month, 9,000 liters were still in process, 40% converted as to labor and factory overhead. All direct materials are placed in mixing at the beginning of the process and conversion costs occur evenly during the process. Dharma uses weighted-average costing. Determine the equivalent units in process for direct materials, assuming that 16,000 liters of chemicals were 40% complete prior to the addition of the 195,000 liters

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Answer 2

Question

Chapter 6, Problem 6.29AP

1.

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.

In First-in-First-Out method, the cost of initial purchased items are sold first. The value of the ending inventory consists the recent purchased items.

In Last-in-First-Out method, the cost of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

In Average Cost Method the cost of inventory is priced at the average rate of the goods available for sale. Following is the mathematical representation:

Weighted-average Cost=Total Cost of Goods Available For SaleTotal Number of Units Available For Sale

To Prepare: The perpetual inventory record for the merchandise inventory using the FIFO inventory costing method.

2.

To determine

To Prepare: The perpetual inventory record for the merchandise inventory using the LIFO inventory costing method.

3.

To determine

To Prepare: The perpetual inventory record for the merchandise inventory using the weighted average inventory costing method.

4.

To determine

The Company’s cost of goods sold for August using FIFO, LIFO, and weighted-average inventory costing methods.

5.

To determine

To Compute: The gross profit for August using FIFO, LIFO, and weighted-average inventory costing method.

6.

To determine

To Explain: The method that the company should use to maximize gross profit.

Expert Solution & Answer

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Answer 3

Question

Chapter 6, Problem 6.29AP

1.

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.

In First-in-First-Out method, the cost of initial purchased items are sold first. The value of the ending inventory consists the recent purchased items.

In Last-in-First-Out method, the cost of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

In Average Cost Method the cost of inventory is priced at the average rate of the goods available for sale. Following is the mathematical representation:

Weighted-average Cost=Total Cost of Goods Available For SaleTotal Number of Units Available For Sale

To Prepare: The perpetual inventory record for the merchandise inventory using the FIFO inventory costing method.

2.

To determine

To Prepare: The perpetual inventory record for the merchandise inventory using the LIFO inventory costing method.

3.

To determine

To Prepare: The perpetual inventory record for the merchandise inventory using the weighted average inventory costing method.

4.

To determine

The Company’s cost of goods sold for August using FIFO, LIFO, and weighted-average inventory costing methods.

5.

To determine

To Compute: The gross profit for August using FIFO, LIFO, and weighted-average inventory costing method.

6.

To determine

To Explain: The method that the company should use to maximize gross profit.

Expert Solution & Answer

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Answer 4

Question

Chapter 6, Problem 6.29AP

1.

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.

In First-in-First-Out method, the cost of initial purchased items are sold first. The value of the ending inventory consists the recent purchased items.

In Last-in-First-Out method, the cost of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

In Average Cost Method the cost of inventory is priced at the average rate of the goods available for sale. Following is the mathematical representation:

Weighted-average Cost=Total Cost of Goods Available For SaleTotal Number of Units Available For Sale

To Prepare: The perpetual inventory record for the merchandise inventory using the FIFO inventory costing method.

2.

To determine

To Prepare: The perpetual inventory record for the merchandise inventory using the LIFO inventory costing method.

3.

To determine

To Prepare: The perpetual inventory record for the merchandise inventory using the weighted average inventory costing method.

4.

To determine

The Company’s cost of goods sold for August using FIFO, LIFO, and weighted-average inventory costing methods.

5.

To determine

To Compute: The gross profit for August using FIFO, LIFO, and weighted-average inventory costing method.

6.

To determine

To Explain: The method that the company should use to maximize gross profit.

Expert Solution & Answer

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Answer 5

Chapter 6, Problem 6.29AP

1.

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.

In First-in-First-Out method, the cost of initial purchased items are sold first. The value of the ending inventory consists the recent purchased items.

In Last-in-First-Out method, the cost of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

In Average Cost Method the cost of inventory is priced at the average rate of the goods available for sale. Following is the mathematical representation:

Weighted-average Cost=Total Cost of Goods Available For SaleTotal Number of Units Available For Sale

To Prepare: The perpetual inventory record for the merchandise inventory using the FIFO inventory costing method.

2.

To determine

To Prepare: The perpetual inventory record for the merchandise inventory using the LIFO inventory costing method.

3.

To determine

To Prepare: The perpetual inventory record for the merchandise inventory using the weighted average inventory costing method.

4.

To determine

The Company’s cost of goods sold for August using FIFO, LIFO, and weighted-average inventory costing methods.

5.

To determine

To Compute: The gross profit for August using FIFO, LIFO, and weighted-average inventory costing method.

6.

To determine

To Explain: The method that the company should use to maximize gross profit.

Answer 6

Chapter 6, Problem 6.29AP

1.

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.

In First-in-First-Out method, the cost of initial purchased items are sold first. The value of the ending inventory consists the recent purchased items.

In Last-in-First-Out method, the cost of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

In Average Cost Method the cost of inventory is priced at the average rate of the goods available for sale. Following is the mathematical representation:

Weighted-average Cost=Total Cost of Goods Available For SaleTotal Number of Units Available For Sale

To Prepare: The perpetual inventory record for the merchandise inventory using the FIFO inventory costing method.

Answer 7

Chapter 6, Problem 6.29AP

1.

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.

In First-in-First-Out method, the cost of initial purchased items are sold first. The value of the ending inventory consists the recent purchased items.

In Last-in-First-Out method, the cost of last purchased items are sold first. The value of the closing stock consists the initial purchased items.

In Average Cost Method the cost of inventory is priced at the average rate of the goods available for sale. Following is the mathematical representation:

Weighted-average Cost=Total Cost of Goods Available For SaleTotal Number of Units Available For Sale

To Prepare: The perpetual inventory record for the merchandise inventory using the FIFO inventory costing method.

Answer 8

2.

To determine

To Prepare: The perpetual inventory record for the merchandise inventory using the LIFO inventory costing method.

Answer 9

2.

To determine

To Prepare: The perpetual inventory record for the merchandise inventory using the LIFO inventory costing method.

Answer 10

3.

To determine

To Prepare: The perpetual inventory record for the merchandise inventory using the weighted average inventory costing method.

Answer 11

3.

To determine

To Prepare: The perpetual inventory record for the merchandise inventory using the weighted average inventory costing method.

Answer 12

4.

To determine

The Company’s cost of goods sold for August using FIFO, LIFO, and weighted-average inventory costing methods.

Answer 13

4.

To determine

The Company’s cost of goods sold for August using FIFO, LIFO, and weighted-average inventory costing methods.

Answer 14

5.

To determine

To Compute: The gross profit for August using FIFO, LIFO, and weighted-average inventory costing method.

Answer 15

5.

To determine

To Compute: The gross profit for August using FIFO, LIFO, and weighted-average inventory costing method.

Answer 16

6.

To determine

To Explain: The method that the company should use to maximize gross profit.

Answer 17

6.

To determine

To Explain: The method that the company should use to maximize gross profit.

Answer 18

Expert Solution & Answer

Answer 19

Expert Solution & Answer

Answer 20

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Answer 21

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To Prepare: The perpetual inventory record for the merchandise inventory using the LIFO inventory costing method.

To Prepare: The perpetual inventory record for the merchandise inventory using the weighted average inventory costing method.

The Company’s cost of goods sold for August using FIFO, LIFO, and weighted-average inventory costing methods.

To Compute: The gross profit for August using FIFO, LIFO, and weighted-average inventory costing method.

To Explain: The method that the company should use to maximize gross profit.

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