1. Compute the costs of goods available. 2. Compute the number of units in endin
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Question
1. Compute the costs of goods available. 2. Compute the number of units in ending inventory 3. Compute the costs assigned to ending inventory FIFO, LIFO, weighted average and specific indentification. 4. Compute gross profit earned by the company for each of the costing methods !Suggested Sites eb slice Gallery WhitePages | Tampa-RE Esq. 1 Imported From IE avast! Pro Antivirus Kasper CHAPTER 6+HOMEWORK 1 Problem 6-3A Perpetual: Alternative cost flows LO P 15 points Montoure Company uses a perpetual Inventory system. It entered into the following calendar-year purchases and sales transactions an- Beginning inventory Feb. 10 Purchase Max. 13 Parchase Mar. 15 Sales Aug. 21 Purchase Sept. 5 Purchase Sept 10 Sales 620 unit$45 per unit 380 unitse $42 per unit 100 uniea & $30 per undt 735 units $70 per untt eBcok 170 units $50 per unit 400 units $46 per unit 570 unitee $70 per unit Totals 670 units 1, 305 unlts Required Peterencesl1. Compute cost of goods available for sale and the number of units available for sale. of goods avaiable for sale of units 2. Compute the number of units In ending Inventory
Explanation / Answer
1. Compute the costs of goods available
Number of units
Cost per unit
Cost of goods available for sale
Beginning inventory
620
$45.00
$27,900
Purchases:
10-Feb
380
42
$15,960
13-Mar
100
30
$3,000
21-Aug
170
50
$8,500
5-Sep
400
46
$18,400
Total
1,670 units
$73,760
2. Compute the number of units in ending inventory :
= number of units available for sale - units sold
= 1,670 - 1,305 units = 365 units.
3. Compute the costs assigned to ending inventory FIFO, LIFO, weighted average and specific identification:
FIFO
Goods purchased
Goods sold
Ending inventory
1-Jan
620
$45.00
$27,900.00
10-Feb
380
$42.00
620
$45.00
$27,900.00
380
42
15,960.00
9-Mar
100
30
620
$45.00
$27,900.00
380
42
15,960.00
100
30
3,000.00
15-Mar
620
$45.00
$27,900.00
265
42
11,130.00
115
42
$4,830.00
100
30
3,000.00
21-Aug
170
$50.00
265
42
11,130.00
100
30
3,000.00
170
50
8,500.00
5-Sep
400
$46.00
265
42
11,130.00
100
30
3,000.00
170
50
8,500.00
400
46
18400
10-Sep
265
42
11,130.00
100
30
3,000.00
170
50
8,500.00
365
46
16,790.00
35
46
1,610.00
Totals
$56,970.00
16,790.00
LIFO
Goods purchased
Goods sold
Ending inventory
1-Jan
620
$45.00
$27,900.00
10-Feb
380
$42.00
620
$45.00
$27,900.00
380
42
15,960.00
9-Mar
100
30
620
$45.00
$27,900.00
380
42
15,960.00
100
30
3,000.00
15-Mar
100
$30.00
$3,000.00
365
45
16,425.00
380
42
$15,960.00
-
255
45
$11,475.00
21-Aug
170
$50.00
365
45
16,425.00
170
50
8,500.00
5-Sep
400
$46.00
365
45
16,425.00
170
50
8,500.00
400
46
18400
10-Sep
400
46
18,400.00
170
50
8,500.00
365
45
16,425.00
Totals
57,335.00
16,425.00
Weighted average Perpetual:
Goods purchased
Goods sold
Ending inventory
1-Jan
620
$45.00
$27,900.00
10-Feb
380
$42.00
620
$45.00
$27,900.00
380
42
15,960.00
9-Mar
100
30
620
$45.00
$27,900.00
380
42
15,960.00
100
30
3,000.00
Average
1,100
$42.60
$46,860.00
15-Mar
735
$42.60
$31,311.00
365
$42.60
15,549.00
21-Aug
170
$50.00
365
42.6
15,549.00
170
50
8,500.00
Average
535
44.95
24,049.00
5-Sep
400
$46.00
535
44.95
24,048.25
400
46
18400
Average
935
45.40
42,448.25
10-Sep
570
45.40
25,877.54
365
45.40
16,570.71
Totals
57,188.54
16,570.71
Specific identification:
1-Jan
620
$45.00
$27,900.00
10-Feb
380
$42.00
620
$45.00
$27,900.00
380
42
15,960.00
9-Mar
100
30
620
$45.00
$27,900.00
380
42
15,960.00
100
30
3,000.00
15-Mar
620
$45.00
$27,900.00
265
42
11,130.00
115
42
$4,830.00
100
30
3,000.00
21-Aug
170
$50.00
265
42
11,130.00
100
30
3,000.00
170
50
8,500.00
5-Sep
400
$46.00
265
42
11,130.00
100
30
3,000.00
170
50
8,500.00
400
46
18,400
10-Sep
265
42
11,130.00
100
30
3,000.00
120
50
6,000.00
50
50
2,500.00
180
46
8,280.00
220
46
10,120.00
Totals
61,140.00
12,620.00
4. Compute gross profit earned by the company for each of the costing methods !
FIFO
LIFO
Weighted Average
Specific Identification
Sales
91,350.00
91,350.00
91,350.00
91,350.00
Less: Cost of goods sold
56,970.00
57,335.00
57,188.54
61,140.00
Gross profit
34,380.00
34,015.00
34,161.46
30,210.00
Number of units
Cost per unit
Cost of goods available for sale
Beginning inventory
620
$45.00
$27,900
Purchases:
10-Feb
380
42
$15,960
13-Mar
100
30
$3,000
21-Aug
170
50
$8,500
5-Sep
400
46
$18,400
Total
1,670 units
$73,760
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