Here are solutions that are solved, can you explain where each set of numbers in

Question

Here are solutions that are solved, can you explain where each set of numbers in the parenthesis are coming from ! I’m trying to understand FIFO/LIFO ! 2. Compute cost of goods sold and pretax income for 2012 under the FIFO and LIFO accounting methods. Assume that a company's beginning inventory and purchases for 2012 included Beginning inventory 10 units$6 each Purchases January 5units@$10 each Purchases May 5 units @$12 each un#5 During 2012, 15 units were sold for $20 each) and other operating expenses totaled $100. FIFO: CGS (10 x 6)+(5 x 10)-110/ Cost of ending inventory 5x 12- ag Revenue 300 115 x 201-110 cGS-100-90 Uniis Sold Exps UFO: CGS (5 x 12)+ (5x 10)+ ( x 6) 140 Cost of ending inventory - 5 x 6-30 Revenue -300 [15 x 20)-140 CGS-100-6o Amoune s Sold cost of goods sold and pretax income for 2013 under the FIFO and LIFO accounting ACompute methods. Using the 2012 ending inventory amount from the previous problem for the 2013 beginning inventory amount. Assume that a company's purchases for 2013 included Purchases March Purchases November 6 units $13 each 5 units $14 each During 2013, 10 units were sold for $24 each, and other operating expenses totaled $70 FIFO: CGS (x 12) +i5 x 13)- 125/Cost of ending inventory- (x13) (5 x 14)-83 Hag Revenue-24011002:?25CG3-70-45 Units Solo LIFO: CGS-5 x 14) + (5 x 13) = 135 / Cost of ending inventory = (1 x 13) + (5 x 6) = 43 Revenue (240 [10 x 24)135 cGs-70-35 Unds Sold 54s.

Explanation / Answer

STATEMENT SHOWING INVENTORY RECORD UNDER PERIODIC FIFO METHOD RECIEPTS COST OF GOODS SOLD BALANCE DATE UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ Balance 10 6 60 10 6 60 Purchasejan 5 10 50 5 10 50 Purchase may 5 12 60 5 12 60 TOTAL 20 170 15 110 5 60 STATEMENT SHOWING INVENTORY RECORD UNDER PERIODIC LIFO METHOD RECIEPTS COST OF GOODS SOLD BALANCE DATE UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ Balance 10 6 60 5 6 30 5 6 30 Purchasejan 5 10 50 5 10 50 Purchase may 5 12 60 5 12 60 TOTAL 20 170 15 140 5 30 FIFO LIFO COGS 110 140 ENDING INVENTORY 60 30 Net INCOME FIFO LIFO Sales revenue 300 300 Less: COGS 110 140 Gross margin 190 160 Less: Operating expense 100 100 Net income 90 60

Related Questions

Navigate

• Browse (All)
• Browse H
• Subjects

---

---

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