13 value: 10.00 points Mojo Industries tracks the number of units purchased and

Question

13 value: 10.00 points Mojo Industries tracks the number of units purchased and sold throughout each accounting period but applies its inventory costing method at the time of each sale, as if it uses a perpetual inventory system Assume its accounting records provided the following information at the end of the accounting period January 31. The inventory's selling price is $10 per unit. Transactions Inventory, January1 Sale, January 10 Purchase, January 12 Sale, January 17 Purchase, January 26 Units 380 290) 435 (240) 125 Unit Cost Total Cost $3.50 4.00 5.00 $1,330 1,740 625 Required 1-a. Calculate the cost of goods sold and ending inventory for Mojo Industries assuming it applies the LIFO cost method perpetually at the time of each sale Ending Inventory Cost of Goods Sold 1-b. Does the use of a perpetual inventory system result in a higher or lower cost of goods sold than the periodic inventory system when costs are rising? Lower Cost of Goods Sold Higher Cost of Goods Sold References eBook & Resource

Explanation / Answer

STATEMENT SHOWING INVENTORY RECORD UNDER PERPETUAL LIFO METHOD RECIEPTS COST OF GOODS SOLD BALANCE DATE UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ 1-Jan 380 3.5 1330 10-Jan 290 3.5 1015 90 3.5 315 12-Jan 435 4 1740 90 3.5 315 435 4 1740 17-Jan 240 4 960 90 3.5 315 195 4 780 26-Jan 125 5 625 90 3.5 315 195 4 780 125 5 625 TOTAL 560 2365 530 1975 410 1720 Req 1-a: LIFO: Ending Inventory 1720 Cost of Goods sold 1975 Req 1b: Lower cost of Goods sold.

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.