Homework: Week 4 - Chapter 06 exercises Save score: 0 of 1 pt 10 of 10 (8 comple

Question

Homework: Week 4 - Chapter 06 exercises Save score: 0 of 1 pt 10 of 10 (8 complete) HW Score: 80%, 8 of 10 pts E6A-26 (similar to) Question Help Assume that Jump Coffee Shop completed the following periodic inventory transactions for a line of merchandise inventory (Click the icon to view the transactions.) Requirements 1. Compute ending merchandise inventory, cost of goods sold, and gross profit using the FIFO inventory costing method 2. Compute ending merchandise inventory, cost of goods sold, and gross profit using the LIFO inventory costing method 3. Compute ending merchandise inventory, cost of goods sold, and gross profit using the weighted-average inventory costing method. (Round weighted-average cost per unit to the nearest cent and all other amounts to the nearest dollar) Requirements 1, 2, and 3. Compute ending merchandise inventory, cost of goods sold, and gross profit using the (1) FIFO inventory costing metnod, 2) LIFO inventory costing method, and (3) weighted-average inventory costing method. (Round weighted-average cost per u nit to the nearest cent and all other armounts to the nearest dollar.) Begin by determining ending merchandise inventory and cost of goods sold under each of the three methods. Requirement 1 FIFO Beginning merchandise inventory Plus [Net purchases Cost of goods available for sale Less Ending merchandiso inventory Cost of goods sold

Explanation / Answer

Beginning units = 20

Units Purchase = 30

(-) Units sold = 33

Ending Inventory = 17

(1) FIFO :-

Beginning Merchandise Inventory (20 * 18)

360

(+) Net Purchases (10 * 22) + (20 * 24)

700

Cost of goods available for sale

1060

(-) Ending merchandise Inventory (consist June 24 Purchase) (17 * 24)

408

Cost of goods sold

652

Sale (12 * 31) + (21 * 31)

1023

Gross Profit (1023 – 652)

371

(2) LIFO :-

Beginning Merchandise Inventory (20 * 18)

360

(+) Net Purchases (10 * 22) + (20 * 24)

700

Cost of goods available for sale

1060

(-) Ending merchandise Inventory (consist Beginning Inventory)

     (17 * 18)

306

Cost of goods sold

754

Sale (12 * 31) + (21 * 31)

1023

Gross Profit (1023 – 754)

269

(3) Weighted Avg:-

Beginning Merchandise Inventory (20 * 18)

360

(+) Net Purchases (10 * 22) + (20 * 24)

700

Cost of goods available for sale

1060

(-) Ending merchandise Inventory    (17 * 21.2)

360

Cost of goods sold

700

Sale (12 * 31) + (21 * 31)

1023

Gross Profit (1023 – 700)

323

Unit cost = Cost of goods available for sale/Units available for sale

     = 1060/(20+10+20) = 21.2

Beginning Merchandise Inventory (20 * 18)

360

(+) Net Purchases (10 * 22) + (20 * 24)

700

Cost of goods available for sale

1060

(-) Ending merchandise Inventory (consist June 24 Purchase) (17 * 24)

408

Cost of goods sold

652

Sale (12 * 31) + (21 * 31)

1023

Gross Profit (1023 – 652)

371

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