Perpetual Inventory System: 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. First-in-First-Out: In First-in-First-Out method, the costs of the initially purchased items are considered as cost of goods sold, for the items which are sold first. The value of the ending inventory consists of the recent purchased items. Last-in-Last-Out: In Last-in-First-Out method, the costs of last purchased items are considered as the cost of goods sold, for the items which are sold first. The value of the closing stock consists of the initial purchased items. Moving -average cost method: Under moving average cost method, the company calculates a new average cost after every purchase is made. It is determined by dividing the cost of goods available for sale by the units on hand. The ending inventory under a perpetual inventory system using FIFO.

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Answer 1

Question

Chapter 6, Problem 6.9AP

(a) (1)

To determine

Perpetual Inventory System:

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.

First-in-First-Out:

In First-in-First-Out method, the costs of the initially purchased items are considered as cost of goods sold, for the items which are sold first. The value of the ending inventory consists of the recent purchased items.

Last-in-Last-Out:

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

Moving -average cost method:

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

The ending inventory under a perpetual inventory system using FIFO.

(2)

To determine

The ending inventory under a perpetual inventory system using moving-average cost.

(3)

To determine

The ending inventory under a perpetual inventory system using LIFO.

(b)

To determine

To identify: The costing method which produces the highest ending inventory valuation.

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Harriet Manufacturing's budget for the coming year includes $780,000 for manufacturing overhead, 85,000 hours of direct labor, and 520,000 hours of machine time. If Harriet applies overhead using a predetermined rate based on machine hours, what amount of overhead will be assigned to a unit of output which requires 0.78 machine hours and 0.32 labor hours to complete?

Please provide the accurate answer to this general accounting problem using valid techniques.

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Answer 2

Question

Chapter 6, Problem 6.9AP

(a) (1)

To determine

Perpetual Inventory System:

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.

First-in-First-Out:

In First-in-First-Out method, the costs of the initially purchased items are considered as cost of goods sold, for the items which are sold first. The value of the ending inventory consists of the recent purchased items.

Last-in-Last-Out:

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

Moving -average cost method:

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

The ending inventory under a perpetual inventory system using FIFO.

(2)

To determine

The ending inventory under a perpetual inventory system using moving-average cost.

(3)

To determine

The ending inventory under a perpetual inventory system using LIFO.

(b)

To determine

To identify: The costing method which produces the highest ending inventory valuation.

Expert Solution & Answer

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Answer 3

Question

Chapter 6, Problem 6.9AP

(a) (1)

To determine

Perpetual Inventory System:

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.

First-in-First-Out:

In First-in-First-Out method, the costs of the initially purchased items are considered as cost of goods sold, for the items which are sold first. The value of the ending inventory consists of the recent purchased items.

Last-in-Last-Out:

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

Moving -average cost method:

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

The ending inventory under a perpetual inventory system using FIFO.

(2)

To determine

The ending inventory under a perpetual inventory system using moving-average cost.

(3)

To determine

The ending inventory under a perpetual inventory system using LIFO.

(b)

To determine

To identify: The costing method which produces the highest ending inventory valuation.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 6, Problem 6.9AP

(a) (1)

To determine

Perpetual Inventory System:

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.

First-in-First-Out:

In First-in-First-Out method, the costs of the initially purchased items are considered as cost of goods sold, for the items which are sold first. The value of the ending inventory consists of the recent purchased items.

Last-in-Last-Out:

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

Moving -average cost method:

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

The ending inventory under a perpetual inventory system using FIFO.

(2)

To determine

The ending inventory under a perpetual inventory system using moving-average cost.

(3)

To determine

The ending inventory under a perpetual inventory system using LIFO.

(b)

To determine

To identify: The costing method which produces the highest ending inventory valuation.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 6, Problem 6.9AP

(a) (1)

To determine

Perpetual Inventory System:

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.

First-in-First-Out:

In First-in-First-Out method, the costs of the initially purchased items are considered as cost of goods sold, for the items which are sold first. The value of the ending inventory consists of the recent purchased items.

Last-in-Last-Out:

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

Moving -average cost method:

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

The ending inventory under a perpetual inventory system using FIFO.

(2)

To determine

The ending inventory under a perpetual inventory system using moving-average cost.

(3)

To determine

The ending inventory under a perpetual inventory system using LIFO.

(b)

To determine

To identify: The costing method which produces the highest ending inventory valuation.

Answer 6

Chapter 6, Problem 6.9AP

(a) (1)

To determine

Perpetual Inventory System:

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.

First-in-First-Out:

In First-in-First-Out method, the costs of the initially purchased items are considered as cost of goods sold, for the items which are sold first. The value of the ending inventory consists of the recent purchased items.

Last-in-Last-Out:

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

Moving -average cost method:

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

The ending inventory under a perpetual inventory system using FIFO.

Answer 7

Chapter 6, Problem 6.9AP

(a) (1)

To determine

Perpetual Inventory System:

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.

First-in-First-Out:

In First-in-First-Out method, the costs of the initially purchased items are considered as cost of goods sold, for the items which are sold first. The value of the ending inventory consists of the recent purchased items.

Last-in-Last-Out:

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

Moving -average cost method:

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

The ending inventory under a perpetual inventory system using FIFO.

Answer 8

(2)

To determine

The ending inventory under a perpetual inventory system using moving-average cost.

Answer 9

(2)

To determine

The ending inventory under a perpetual inventory system using moving-average cost.

Answer 10

(3)

To determine

The ending inventory under a perpetual inventory system using LIFO.

Answer 11

(3)

To determine

The ending inventory under a perpetual inventory system using LIFO.

Answer 12

(b)

To determine

To identify: The costing method which produces the highest ending inventory valuation.

Answer 13

(b)

To determine

To identify: The costing method which produces the highest ending inventory valuation.

Answer 14

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Answer 15

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Answer 16

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Answer 17

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The ending inventory under a perpetual inventory system using moving-average cost.

The ending inventory under a perpetual inventory system using LIFO.

To identify: The costing method which produces the highest ending inventory valuation.

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