The beginning inventory for Dunne Co. and data on purchases and sales for a thre
ID: 2396805 • Letter: T
Question
The beginning inventory for Dunne Co. and data on purchases and sales for a three-month period are as follows:
Required:
1. Determine the inventory on June 30 and the cost of goods sold for the three-month period, using the first-in, first-out method and the periodic inventory system. Round the weighted average unit cost to the nearest cent.
2. Determine the inventory on June 30 and the cost of goods sold for the three-month period, using the last-in, first-out method and the periodic inventory system.
3. Determine the inventory on June 30 and the cost of goods sold for the three-month period, using the weighted average cost method and the periodic inventory system.
Note: Round the weighted average unit cost to the nearest dollar and final answers to the nearest dollar.
4. Compare the gross profit and June 30 inventories using the following column headings. Enter all amounts as positive numbers.
Date Transaction Numberof Units Per Unit Total Apr. 3 Inventory 25 $1,200 $30,000 8 Purchase 75 1,240 93,000 11 Sale 40 2,000 80,000 30 Sale 30 2,000 60,000 May 8 Purchase 60 1,260 75,600 10 Sale 50 2,000 100,000 19 Sale 20 2,000 40,000 28 Purchase 80 1,260 100,800 June 5 Sale 40 2,250 90,000 16 Sale 25 2,250 56,250 21 Purchase 35 1,264 44,240 28 Sale 44 2,250 99,000
Explanation / Answer
Answers
FIFO
Cost of Goods available for sale
Cost of Goods Sold
Ending Inventory
Units
Cost/unit
COG for sale
Units sold
Cost/unit
COGS
Units
Cost/unit
Ending inventory
Beginning Inventory
25
$ 1,200.00
$ 30,000.00
25
$ 1,200.00
$ 30,000.00
0
$ 1,200.00
$ -
Purchases:
08-Apr
75
$ 1,240.00
$ 93,000.00
75
$ 1,240.00
$ 93,000.00
0
$ 1,240.00
$ -
08-May
60
$ 1,260.00
$ 75,600.00
60
$ 1,260.00
$ 75,600.00
0
$ 1,260.00
$ -
28-May
80
$ 1,260.00
$ 100,800.00
80
$ 1,260.00
$ 100,800.00
0
$ 1,260.00
$ -
21-Jun
35
$ 1,264.00
$ 44,240.00
9
$ 1,264.00
$ 11,376.00
26
$ 1,264.00
$ 32,864.00
TOTAL
275
$ 343,640.00
249
$ 310,776.00
26
$ 32,864.00
LIFO
Cost of Goods available for sale
Cost of Goods Sold
Ending Inventory
Units
Cost/unit
COG for sale
Units sold
Cost/unit
COGS
Units
Cost/unit
Ending inventory
Beginning Inventory
25
$ 1,200.00
$ 30,000.00
0
$ 1,200.00
$ -
25
$ 1,200.00
$ 30,000.00
Purchases:
0
$ -
$ -
08-Apr
75
$ 1,240.00
$ 93,000.00
74
$ 1,240.00
$ 91,760.00
1
$ 1,240.00
$ 1,240.00
08-May
60
$ 1,260.00
$ 75,600.00
60
$ 1,260.00
$ 75,600.00
0
$ 1,260.00
$ -
28-May
80
$ 1,260.00
$ 100,800.00
80
$ 1,260.00
$ 100,800.00
0
$ 1,260.00
$ -
21-Jun
35
$ 1,264.00
$ 44,240.00
35
$ 1,264.00
$ 44,240.00
0
$ 1,264.00
$ -
TOTAL
275
$ 343,640.00
249
$ 312,400.00
26
$ 31,240.00
Average Method
Cost of Goods available for sale
Cost of Goods Sold
Ending Inventory
Units
Cost/unit
COG for sale
Units sold
Cost/unit
COGS
Units
Cost/unit
Ending inventory
Beginning Inventory
25
$ 1,200.00
$ 30,000.00
Purchases:
0
$ -
$ -
08-Apr
75
$ 1,240.00
$ 93,000.00
08-May
60
$ 1,260.00
$ 75,600.00
28-May
80
$ 1,260.00
$ 100,800.00
21-Jun
35
$ 1,264.00
$ 44,240.00
TOTAL
275
$ 1,250
$ 343,640.00
249
$ 1,250
$ 311,250.00
26
$ 1,250
$ 32,500.00
---Based on above workings:
Requirement 1
Requirement 2
Requirement 3
Inventory, June 30 [26 units]
$ 32,864
$ 31,240
$ 32,500
Cost of Goods Sold [249 units]
$ 310,776
$ 343,640
$ 311,250
FIFO
LIFO
Weighted Average Method
Sales Revenue
$ 525,250.00
$ 525,250.00
$ 525,250.00
(-) Cost of Goods Sold (as calculated above)
$ 310,776.00
$ 312,400.00
$ 311,250.00
Gross Margin
$ 214,474.00
$ 212,850.00
$ 214,000.00
Inventory, June 30
$ 32,864.00
$ 31,240.00
$ 32,500.00
FIFO
Cost of Goods available for sale
Cost of Goods Sold
Ending Inventory
Units
Cost/unit
COG for sale
Units sold
Cost/unit
COGS
Units
Cost/unit
Ending inventory
Beginning Inventory
25
$ 1,200.00
$ 30,000.00
25
$ 1,200.00
$ 30,000.00
0
$ 1,200.00
$ -
Purchases:
08-Apr
75
$ 1,240.00
$ 93,000.00
75
$ 1,240.00
$ 93,000.00
0
$ 1,240.00
$ -
08-May
60
$ 1,260.00
$ 75,600.00
60
$ 1,260.00
$ 75,600.00
0
$ 1,260.00
$ -
28-May
80
$ 1,260.00
$ 100,800.00
80
$ 1,260.00
$ 100,800.00
0
$ 1,260.00
$ -
21-Jun
35
$ 1,264.00
$ 44,240.00
9
$ 1,264.00
$ 11,376.00
26
$ 1,264.00
$ 32,864.00
TOTAL
275
$ 343,640.00
249
$ 310,776.00
26
$ 32,864.00
LIFO
Cost of Goods available for sale
Cost of Goods Sold
Ending Inventory
Units
Cost/unit
COG for sale
Units sold
Cost/unit
COGS
Units
Cost/unit
Ending inventory
Beginning Inventory
25
$ 1,200.00
$ 30,000.00
0
$ 1,200.00
$ -
25
$ 1,200.00
$ 30,000.00
Purchases:
0
$ -
$ -
08-Apr
75
$ 1,240.00
$ 93,000.00
74
$ 1,240.00
$ 91,760.00
1
$ 1,240.00
$ 1,240.00
08-May
60
$ 1,260.00
$ 75,600.00
60
$ 1,260.00
$ 75,600.00
0
$ 1,260.00
$ -
28-May
80
$ 1,260.00
$ 100,800.00
80
$ 1,260.00
$ 100,800.00
0
$ 1,260.00
$ -
21-Jun
35
$ 1,264.00
$ 44,240.00
35
$ 1,264.00
$ 44,240.00
0
$ 1,264.00
$ -
TOTAL
275
$ 343,640.00
249
$ 312,400.00
26
$ 31,240.00
Average Method
Cost of Goods available for sale
Cost of Goods Sold
Ending Inventory
Units
Cost/unit
COG for sale
Units sold
Cost/unit
COGS
Units
Cost/unit
Ending inventory
Beginning Inventory
25
$ 1,200.00
$ 30,000.00
Purchases:
0
$ -
$ -
08-Apr
75
$ 1,240.00
$ 93,000.00
08-May
60
$ 1,260.00
$ 75,600.00
28-May
80
$ 1,260.00
$ 100,800.00
21-Jun
35
$ 1,264.00
$ 44,240.00
TOTAL
275
$ 1,250
$ 343,640.00
249
$ 1,250
$ 311,250.00
26
$ 1,250
$ 32,500.00
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