Nicole’s Getaway Spa would make monthly purchases from the supplier at a cost th

Question

Nicole’s Getaway Spa would make monthly purchases from the supplier at a cost that included production costs and a transportation charge. Nicole’s Getaway Spa would keep track of its new inventory using a perpetual inventory system. On December 30, 2013, Nicole’s Getaway Spa purchased 10 units at a total cost of $6.30 per unit. Nicole purchased 40 more units at $8.30 in February 2014, but returned 20 defective units to her supplier. In March, Nicole purchased 20 units at $10.30 per unit. In May, 50 units were purchased at $10 per unit; however, Nicole took advantage of a 2/10, n/30 discount from her supplier. In June, NGS sold 50 units at a selling price of $12.30 per unit and 30 units at $10.30 per unit.

1. Compute the Cost of Goods Available for Sale, Cost of Goods Sold, and Cost of Ending Inventory using the first-in, first-out (FIFO) method. (Round "Cost per Unit" and "Total" to 2 decimal places.

March

FIFA perpetual Units Cost Per Unit Total Beginning inventory at Dec 30 Purchases February

March

May Purchase Return (February) Net purchases Discount (may) Goods available for sale Cost of Goods Sold Units from beginning inventory Units from feb purchase Units from march puchase Units from may purchase Total cost of goods sold Ending inventory

Explanation / Answer

FEFA Perpetual PARTICULAR UNITS COST PER UNIT TOTAL Beginning units as at 30 Dec 0 0 0 Purchase 10 $6.30 $63.00 February 40 $8.30 $332.00 March 20 $10.30 $206.00 May 50 $10.00 $500.00 Purchase return(February) 20 $8.30 $166.00 Net Purchase 100 $935 Discount(May)(36.72%) 50 $3.67 $269 Goods available for sale 100 $666 cost of good sold 50 $12.30 $615 30 $10.30 $309 Unit from beginning Inventory 0 $0 $0 Unit from Feb purchase 0 $0 $0 Unit from March Purchase 0 $0 $0 Unit from May Purchase 40 $6.33 $253.20

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