Financial Accounting (12th Edition) (What's New in Accounting)
12th Edition
ISBN: 9780134725987
Author: C. William Thomas, Wendy M. Tietz, Walter T. Harrison Jr.
Publisher: PEARSON
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Textbook Question
Chapter 6A, Problem 3E
(Compute amounts for the GAAP inventory methods—periodic system) Suppose Synthetix Corporation’s inventory records for a particular computer chip indicate the following at October 31:
| Oct 1 | Beginning inventory .................... | 4 units @ $60 = $240 |
| 8 | Purchase ....................................... | 3 units @ $60 = 180 |
| 15 | Purchase ....................................... | 12 units @ $70 = 840 |
| 26 | Purchase ....................................... | 1 units @ $80 = 80 |
The physical count of inventory at October 31 indicates that five units of inventory are on hand.
Requirements
Compute ending inventory and cost of goods sold, using each of the following methods
1. Specific unit cost, assuming three $60 units and two $70 units are on hand
2. Average cost (round average unit cost to the nearest cent)
3. First-in, first-out
4. Last-in, first-out
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LIFO, FIFO, & Moving Average Cost: Perpetual Inventory Methods:
Rock Shop shows the following data related to an item of inventory:
Inventory, January 1st..............
100 units @ $5.00
Purchase, January 9th............
300 units @ $5.40
Sold, January 11th..
Purchase, January 19th............
Purchase, January 21st....
Sold, January 28th....
325 units
70 @ $6.00
250 @$6.10
150 units
Please answer the following questions under the Perpetual Inventory Method:
1) What is the value of Ending Inventory & COGS under the FIFO Method?
2) What is the value of Ending Inventory & COGS under the LIFO Method?
3) What is the value of Ending Inventory & COGS under the Moving Avg. Cost Method?
Maria B, Inc. uses a perpetual inventory system. This system includes a perpetual inventory record card for each of the 50 types of the products the company keep in stock. The following transactions show the purchase and sale of particular round table (product code AB-RB7) during November.
Nov.1 Balance on hand, 50 units, cost $60 each…………………………………….$3,000
Nov.4Purchase, 20 Units, cost $65 each……………………………………………..$1300
Nov.8Sale, 35 units, Sale price $100 each…………………………………………...$3500
Nov.9 Purchase, 40 units, cost $65 each……………………………………………..$2600
Nov.20Sale, 60 units, sale price $100 each…………………………………………..$6000
Nov.25Purchase 40 units, cost $70 each…………………………………….……….$2800
Nov.30Sale 5 units sale price $110 ea
Maria B, Inc. uses a perpetual inventory system. This system includes a perpetual inventory record card for each of the 50 types of the products the company keep in stock. The following transactions show the purchase and sale of particular round table (product code AB-RB7)…
Maria B, Inc. uses a perpetual inventory system. This system includes a perpetual inventory record card for each of the 50 types of the products the company keep in stock. The following transactions show the purchase and sale of particular round table (product code AB-RB7) during November.
Nov.1 Balance on hand, 50 units, cost $60 each…………………………………….$3,000
Nov.4Purchase, 20 Units, cost $65 each……………………………………………..$1300
Nov.8Sale, 35 units, Sale price $100 each…………………………………………...$3500
Nov.9 Purchase, 40 units, cost $65 each……………………………………………..$2600
Nov.20Sale, 60 units, sale price $100 each…………………………………………..$6000
Nov.25Purchase 40 units, cost $70 each…………………………………….……….$2800
Nov.30Sale 5 units sale price $110 each………………………………………...…….$550
Required:
Record the beginning inventory, the purchases, the cost of goods sold, and the running balance on an inventory record card by Using Average Cost Method & LIFO method.
Prepare journal entries to record these purchases and sales in…
Chapter 6A Solutions
Financial Accounting (12th Edition) (What's New in Accounting)
Ch. 6A - (Record inventory transactions in the periodic...Ch. 6A - (Compute cost of goods sold and prepare the income...Ch. 6A - (Compute amounts for the GAAP inventory...Ch. 6A - (Journal inventory transactions in the periodic...Ch. 6A - (Compute cost of goods sold and gross profit on...Ch. 6A - (Record transactions in the periodic system;...
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