EX 7-9 Weighted average cost flow method under perpetual inventory system ??? Th
ID: 2519864 • Letter: E
Question
EX 7-9 Weighted average cost flow method under perpetual inventory system ??? The following units of a particular item were available for sale during the calendar year Total Cost of Merchandise Sold $154,400 Jan. 1 Inventory Apr. 19 Sale June 30 Purchase Sept. 2 Sale Nov. 15 Purchase 4,000 units at $20 2,500 units 6,000 units at $24 4,500 units 1,000 units at $25 The firm uses the weighted average cost method with a perpetual inventory system. Determine the cost of merchandise sold for each sale and the inventory balance after each sale. Present the data in the form illustrated in Exhibit 5 EX 7-10 Perpetual inventory using FIFO Assume that the business in Exercise 7-9 maintains a perpetual inventory system. Deter- mine the cost of merchandise sold for each sale and the inventory balance after each sale, assuming the first-in, first-out method. Present the data in the form illustrated in Exhibit 3. OBJ.3 Total Cost of Merchandise Sold, $152,000Explanation / Answer
Calculation of cost of merchandise sold under FIFO (Amounts in $)
1,500 units@$20 = $30,000
6,000 units@$24 = $144,000
1,500 units@$20 = $30,000
6,000 units@$24 = $144,000
1,500 units@$20 = $30,000
(4,500 units - 1,500 units)@$24 = $72,000
3,000 units@$24 = $72,000
1,000 units@$25 = $25,000
Ending inventory Balance = $72,000+$25,000 = $97,000
Cost of Merchandise Sold = $152,000
Date Opening Balance (A) Purchase (B) Cost of merchandise sold (C) Closing Balance (A+B-C) Jan. 1 4,000 units @$20 = $80,000 - - 4,000 units @$20 = $80,000 Apr. 19 4,000 units @$20 = $80,000 - 2,500 units@$20 = $50,000 1,500 units@$20 = $30,000 June 30 1,500 units@$20 = $30,000 6,000 units@$24 = $144,000 -1,500 units@$20 = $30,000
6,000 units@$24 = $144,000
Sept. 21,500 units@$20 = $30,000
6,000 units@$24 = $144,000
-1,500 units@$20 = $30,000
(4,500 units - 1,500 units)@$24 = $72,000
(6,000 - 3,000)@$24 = $72,000 Nov. 15 3,000 units@$24 = $72,000 1,000 units@$25 = $25,000 -3,000 units@$24 = $72,000
1,000 units@$25 = $25,000
Total $169,000 $152,000Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.