Required information Use the following information for the Exercises below. The
ID: 2412444 • Letter: R
Question
Required information Use the following information for the Exercises below. The following information applies to the questions displayed below.) Hemming Co. reported the following current-year purchases and sales for its only product vitiesU Units Aequired at Cost Units sold at Retail Jan. 1 Beginning inventory Jan.10 Sales Mar.14 Purchase Mar.15 Sales July30 Purchase Oct.5 Sales Oct.26 Purchase 270 units$12.80 3,456 400 units $17.807,120 470 units $22.8010,716 170units @$27.80-4226 220 units $42.80 340 units $42.80 440 units $42.80 Totals 1,310 units $26,018 1,000 units Exercise 5-9A Periodic: Inventory costing system LO P3 Required: Hemming uses a periodic inventory system. (a) Determine the costs assigned to ending inventory and to cost of goods sold using FIFO. b) Determine the costs assigned to ending inventory and to cost of goods sold using LIFO. (c) Compute the gross margin for each method. Prev. 1 of 1 NextExplanation / Answer
Answer
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
270
$ 12.80
$ 3,456.00
270
$ 12.80
$ 3,456.00
0
$ 12.80
$ -
Purchases:
14-Mar
400
$ 17.80
$ 7,120.00
400
$ 17.80
$ 7,120.00
0
$ 17.80
$ -
30-Jul
470
$ 22.80
$ 10,716.00
330
$ 22.80
$ 7,524.00
140
$ 22.80
$ 3,192.00
26-Oct
170
$ 27.80
$ 4,726.00
0
$ 27.80
$ -
170
$ 27.80
$ 4,726.00
TOTAL
1310
$ 26,018.00
1000
$ 18,100.00
310
$ 7,918.00
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
270
$ 12.80
$ 3,456.00
0
$ 12.80
$ -
270
$ 12.80
$ 3,456.00
Purchases:
14-Mar
400
$ 17.80
$ 7,120.00
360
$ 17.80
$ 6,408.00
40
$ 17.80
$ 712.00
30-Jul
470
$ 22.80
$ 10,716.00
470
$ 22.80
$ 10,716.00
0
$ 22.80
$ -
26-Oct
170
$ 27.80
$ 4,726.00
170
$ 27.80
$ 4,726.00
0
$ 27.80
$ -
TOTAL
1310
$ 26,018.00
1000
$ 21,850.00
310
$ 4,168.00
Working for Total Sales
Sales
Units
Rate
Amount
Jan-10
220
$ 42.80
$ 9,416.00
Mar-15
340
$ 42.80
$ 14,552.00
Oct-05
440
$ 42.80
$ 18,832.00
Total
1000
$ 42,800.00
Answer: Gross Margin
FIFO
LIFO
Sales Revenue
$ 42,800.00
$ 42,800.00
(-) Cost of Goods Sold (as calculated above)
$ 18,100.00
$ 21,850.00
Gross Margin
$ 24,700.00
$ 20,950.00
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
270
$ 12.80
$ 3,456.00
270
$ 12.80
$ 3,456.00
0
$ 12.80
$ -
Purchases:
14-Mar
400
$ 17.80
$ 7,120.00
400
$ 17.80
$ 7,120.00
0
$ 17.80
$ -
30-Jul
470
$ 22.80
$ 10,716.00
330
$ 22.80
$ 7,524.00
140
$ 22.80
$ 3,192.00
26-Oct
170
$ 27.80
$ 4,726.00
0
$ 27.80
$ -
170
$ 27.80
$ 4,726.00
TOTAL
1310
$ 26,018.00
1000
$ 18,100.00
310
$ 7,918.00
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
270
$ 12.80
$ 3,456.00
0
$ 12.80
$ -
270
$ 12.80
$ 3,456.00
Purchases:
14-Mar
400
$ 17.80
$ 7,120.00
360
$ 17.80
$ 6,408.00
40
$ 17.80
$ 712.00
30-Jul
470
$ 22.80
$ 10,716.00
470
$ 22.80
$ 10,716.00
0
$ 22.80
$ -
26-Oct
170
$ 27.80
$ 4,726.00
170
$ 27.80
$ 4,726.00
0
$ 27.80
$ -
TOTAL
1310
$ 26,018.00
1000
$ 21,850.00
310
$ 4,168.00
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