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 calculate 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: (i) Cost of goods sold, (ii) ending inventory, and (iii) gross profit, under LIFO method.

Question

Want to see the full answer?

Answer 1

Question

Chapter 6, Problem 6.8BP

(a)

(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.

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 calculate 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: (i) Cost of goods sold, (ii) ending inventory, and (iii) gross profit, under LIFO method.

(b)

To determine

To compare: The results for the above three cost flow assumptions.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

hi teacher please help me with General accounting question

Please Made Correct Answer with calculation

General accounting question

Answer 2

Question

Chapter 6, Problem 6.8BP

(a)

(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.

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 calculate 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: (i) Cost of goods sold, (ii) ending inventory, and (iii) gross profit, under LIFO method.

(b)

To determine

To compare: The results for the above three cost flow assumptions.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 6, Problem 6.8BP

(a)

(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.

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 calculate 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: (i) Cost of goods sold, (ii) ending inventory, and (iii) gross profit, under LIFO method.

(b)

To determine

To compare: The results for the above three cost flow assumptions.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 6, Problem 6.8BP

(a)

(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.

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 calculate 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: (i) Cost of goods sold, (ii) ending inventory, and (iii) gross profit, under LIFO method.

(b)

To determine

To compare: The results for the above three cost flow assumptions.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 6, Problem 6.8BP

(a)

(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.

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 calculate 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: (i) Cost of goods sold, (ii) ending inventory, and (iii) gross profit, under LIFO method.

(b)

To determine

To compare: The results for the above three cost flow assumptions.

Answer 6

Chapter 6, Problem 6.8BP

(a)

(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.

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 calculate 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: (i) Cost of goods sold, (ii) ending inventory, and (iii) gross profit, under LIFO method.

Answer 7

Chapter 6, Problem 6.8BP

(a)

(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.

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 calculate 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: (i) Cost of goods sold, (ii) ending inventory, and (iii) gross profit, under LIFO method.

Answer 8

(b)

To determine

To compare: The results for the above three cost flow assumptions.

Answer 9

(b)

To determine

To compare: The results for the above three cost flow assumptions.

Answer 10

Expert Solution & Answer

Answer 11

Expert Solution & Answer

Answer 12

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 13

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...

Concept explainers

Videos

To compare: The results for the above three cost flow assumptions.

Want to see the full answer?

Chapter 6 Solutions