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. 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 6.34BP

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.

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

2.

To determine

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.

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

3.

To determine

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 weighted average inventory costing method.

4.

To determine

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

5.

To determine

To Compute: The gross profit for January 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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Answer 2

Question

Chapter 6, Problem 6.34BP

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.

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

2.

To determine

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.

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

3.

To determine

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 weighted average inventory costing method.

4.

To determine

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

5.

To determine

To Compute: The gross profit for January 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 6.34BP

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.

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

2.

To determine

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.

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

3.

To determine

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 weighted average inventory costing method.

4.

To determine

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

5.

To determine

To Compute: The gross profit for January 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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Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 6, Problem 6.34BP

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.

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

2.

To determine

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.

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

3.

To determine

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 weighted average inventory costing method.

4.

To determine

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

5.

To determine

To Compute: The gross profit for January 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 6.34BP

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.

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

2.

To determine

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.

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

3.

To determine

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 weighted average inventory costing method.

4.

To determine

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

5.

To determine

To Compute: The gross profit for January 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 6.34BP

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.

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

Answer 7

Chapter 6, Problem 6.34BP

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.

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

Answer 8

2.

To determine

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.

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

Answer 9

2.

To determine

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.

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

Answer 10

3.

To determine

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 weighted average inventory costing method.

Answer 11

3.

To determine

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 weighted average inventory costing method.

Answer 12

4.

To determine

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

Answer 13

4.

To determine

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

Answer 14

5.

To determine

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

Answer 15

5.

To determine

To Compute: The gross profit for January 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

Ch. 6 - Which principle or concept states that businesses...Ch. 6 - Which inventory costing method assigns to ending...Ch. 6 - Assume Nile.com began April with 14 units of...Ch. 6 - Suppose Nile.com used the weighted-average...Ch. 6 - Which inventory costing method results in the...Ch. 6 - Prob. 6QC Ch. 6 - At December 31, 2016, Stevenson Company overstated...Ch. 6 - Suppose Maestros had cost of goods sold during the...Ch. 6 - Suppose Nile.com used the LIFO inventory costing...Ch. 6 - Prob. 1RQ

Solution Summary: The author explains how to prepare a perpetual inventory schedule using the FIFO inventory costing method.

Concept explainers

Videos

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.

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

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

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

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

Want to see the full answer?

Chapter 6 Solutions

Solution Summary: The author explains how to prepare a perpetual inventory schedule using the FIFO inventory costing method.

Concept explainers

Videos

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

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

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

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

Want to see the full answer?

Chapter 6 Solutions

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.

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