College Accounting (Book Only): A Career Approach
13th Edition
ISBN: 9781337280570
Author: Scott, Cathy J.
Publisher: South-Western College Pub
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Textbook Question
Chapter C, Problem 1P
Bean Nursery sells bark to its customers at retail. Bean buys bark from a plywood mill in bulk and transports the bark in its own trucks. Information relating to the beginning inventory and purchases of bark is as follows:
Required
Find the cost of 1,200 cubic yards in the ending inventory by the weighted-average-cost method. Carry average cost per cubic yard to four decimals.
Check Figure
Cost of ending inventory, $519.24
Expert Solution & Answer
To determine
Compute the cost of ending inventory using weighted-average-cost method.
Explanation of Solution
Weighted-average cost method: Under average cost method, company calculates a new average after every purchase. It is determined by dividing the cost of goods available for sale by the units on hand.
Compute the cost of ending inventory of 1,200 cubic yards using weighted-average-cost method.
Table (1)
Conclusion
Thus, the cost of 1,200 cubic yards using weighted-average-cost is $519.24.
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Students have asked these similar questions
Quick Stop Dairy had beginning inventory of Heavy Cream of 200 units at a cost of $2 each. During the month, they had the following purchases:
1st purchase: 500 units at $3 each
2nd purchase: 400 units at $4 each
Quick Stop Dairy sold 1,000 units to a customer. Using a FIFO cost flow assumption, determine the cost of goods sold for this sale as well as the balance in ending inventory
Sales during the year were 500 units. Beginning inventory was 400 units at a cost of $6 per unit. Purchase 1 was 200 units at $7 per
unit. Purchase 2 was 100 units at $8 per unit.
Required:
a. Assume the periodic inventory system is used. Calculate cost of goods sold and ending inventory using FIFO method.
b. Assume the periodic inventory system is used. Calculate cost of goods sold and ending inventory using LIFO method.
Complete this question by entering your answers in the tabs below.
Required A Required B
Assume the periodic inventory system is used. Calculate cost of goods sold and ending inventory using FIFO method.
Note: Enter all values as a positive value.
Periodic FIFO
Beginning Inventory
Purchases:
Purchase 1
Purchase 2
Total
Required A
Periodic LIFO
Cost of Goods Available for Sale
Complete this question by entering your answers in the tabs below.
Required B
Beginning Inventory
Purchases:
Purchase 1
Purchase 2
Number Cost per
of units
unit
Total
Cost of Goods
Available for…
Given the following data, what is the cost of goods sold as determined under the LIFO
method if ABC Home Improvements sold 350 air freshener systems for $28 per unit?
Information
Number of
Units
Unit Cost
Beginning Inventory on 1/1
150
$14
Inventory Purchases on 1/5
250
$17
Fill in the blank with your calculated number. DO NOT include commas, $ signs, period,
decimal points, etc., just enter the raw number. Webcourses will add commas to your
answer automatically. For example, if you calculated the answer to be $24,123, you would
only input: 24123
ASUS
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f5
f6
X
f7
f8
f9
f10
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4.
8.
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96
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Chapter C Solutions
College Accounting (Book Only): A Career Approach
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