Anthony Company uses a perpetual inventory system. It entered into the following

ID: 2713965 • Letter: A

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Anthony Company uses a perpetual inventory system. It entered into the following purchases and sales transactions for March.

Date

Activities

Units Acquired at Cost

Units Sold at Retail

Mar.

Beginning inventory

units

@ $50.20/unit

Mar.

Purchase

205

units

@ $55.20/unit

Mar.

Sales

220

units

@ $85.20/unit

Mar.

Purchase

units

@ $60.20/unit

Mar.

Purchase

110

units

@ $62.20/unit

Mar.

Sales

units

@ $95.20/unit

Totals

440

units

310

units

Compute the number of units in ending inventory.

Ending inventory

units

Compute the cost assigned to ending inventory using (a) FIFO, (b) LIFO, (c) weighted average, and (d)specific identification. For specific identification, the March 9 sale consisted of 45 units from beginning inventory and 175 units from the March 5 purchase; the March 29 sale consisted of 25 units from the March 18 purchase and 65 units from the March 25 purchase. (Due to rounding, the sum of Cost of Goods Sold and Ending inventory may not equal the Cost of Good available for sales. Round your per unit costs to 3 decimal places and inventory balances to the nearest dollar amount. Omit the "$" sign in your response.)

Ending
Inventory

(a)

FIFO

(b)

LIFO

(c)

Weighted average

(d)

Specific identification

Compute gross profit earned by the company for each of the four costing methods. For specific identification, the March 9 sale consisted of 45 units from beginning inventory and 175 units from the March 5 purchase; the March 29 sale consisted of 25 units from the March 18 purchase and 65 units from the March 25 purchase. (Round your per unit costs to 3 decimal places and inventory balances and final answer to the nearest dollar amount. Omit the "$" sign in your response.)

Gross profit

FIFO

LIFO

Weighted average

Specific identification

Botch Corp. sold 5,310 units of its product at $46.90 per unit in year 2011 and incurred operating expenses of $7.90 per unit in selling the units. It began the year with 790 units in inventory and made successive purchases of its product as follows.

Jan.

Beginning inventory

790 units

@ $19.90 per unit

Feb.

Purchase

1,690 units

@ $20.90 per unit

May

Purchase

890 units

@ $21.90 per unit

Oct.

Purchase

590 units

@ $22.90 per unit

Dec.

Purchase

3,490 units

@ $23.90 per unit

Total

7,450 units

Prepare comparative income statements for the three inventory costing methods of FIFO, LIFO, and weighted average which includes detailed cost of goods sold section as part of each statement. The company uses a periodic inventory system, and its income tax rate is 35%. (Input all amounts as positive values. Cost of goods sold is the difference of Cost of goods available for sale and ending inventory. Round your per unit costs to 3 decimal places. Round your final answers to the nearest dollar amount. Omit the "$" sign in your response.)

BOTCH CORP.
Income Statements Comparing FIFO, LIFO, and Weighted Average
For Year Ended December 31, 2011

FIFO

LIFO

Weighted
Average

(Click to select)Cost of goods available for saleCost of purchasesSalesInventory, Dec. 31, 2011Inventory, Dec. 31, 2010

Cost of goods sold

(Click to select)Cost of goods available for saleIncome before taxesInventory, Dec. 31, 2011SalesInventory, Dec. 31, 2010

(Click to select)Income before taxesSalesInventory, Dec. 31, 2011Cost of purchasesCost of goods available for sale

(Click to select)Cost of purchasesInventory, Dec. 31, 2010Inventory, Dec. 31, 2011Cost of goods available for saleSales

(Click to select)Inventory, Dec. 31, 2011Cost of purchasesInventory, Dec. 31, 2010SalesCost of goods available for sale

Cost of goods sold

(Click to select)Gross profitGross loss

Expenses

(Click to select)Income before taxesInventory, Dec. 31, 2010Inventory, Dec. 31, 2011Income taxes expenseCost of purchases

(Click to select)Income before taxesCost of purchasesInventory, Dec. 31, 2010Income taxes expenseInventory, Dec. 31, 2011

(Click to select)Net lossNet income

6.The records of Nilson Company provide the following information for the year ended December 31.

At Cost

At Retail

January 1 beginning inventory

472,150

927,950

Cost of goods purchased

3,852,710

6,280,150

Sales

5,503,700

Sales returns

45,400

Required:

Use the retail inventory method to estimate the company's year-end inventory at cost. (Do not round your intermediate calculations. Round your final answers to the nearest dollar amount. Omit the "$" sign in your response.)

Ending inventory at cost

A year-end physical inventory at retail prices yields a total inventory of $1,683,800. Prepare a calculation showing the company’s loss from shrinkage at cost and at retail. (Do not round your intermediate calculations. Round your final answers to the nearest dollar amount. Input all amounts as positive values. Omit the "$" sign in your response.)

NILSON COMPANY
Inventory Shortage
December 31

At Cost

At Retail

(Click to select)Estimated inventoryCost of goods purchasedBeginning inventoryGoods available for saleSales

(Click to select)SalesGoods available for saleCost of goods purchasedPhysical inventoryBeginning inventory

Inventory shortage

7.Wayman Company wants to prepare interim financial statements for the first quarter. The company wishes to avoid making a physical count of inventory. Wayman's gross profit rate averages 40%. The following information for the first quarter is available from its records.

January 1 beginning inventory

430,260

Cost of goods purchased

1,069,050

Sales

1,321,150

Sales returns

10,750

Required:

Use the gross profit method to estimate the company's first quarter ending inventory. (Omit the "$" sign in your response.)

Ending inventory

Anthony Company uses a perpetual inventory system. It entered into the following purchases and sales transactions for March.

MyPCC | Portland Commu x ,Extra credit-BA-21 1-0 4 x M Chapter 5 Homework xG Chegg Study | Guided Sol C f Liezto.mheducation.com/hm.tpx :: Apps M Watch m ovies onlin. "Sign InYouTube G Google P send Money, Pay O· Google Translate Electronics Cars, Fas. Facebook Bank PCC News 3 NBA.com Other bookmarks 2.00 points Botch Corp. sold 5,310 units of its product at $46.90 per unit in year 2011 and incurred operating expenses of $7.90 per unit in selling the units. It began the year with 790 units in inventory and made successive purchases of its product as follows Jan. 1 Beginning inventory Feb. 20 Purchase May 16 Purchase Oct. 3 Purchase Dec. 11 Purchase 790 units@ $19.90 per unit 1,690 units $20.90 per unit 890 units $21.90 per unit 590 units $22.90 per unit 3,490 units @ $23.90 per unit Total 7,450 units Required 1. Prepare comparative income statements for the three inventory costing methods of FIFO, LIFO, and weighted average which includes detailed cost of goods sold section as part of each statement. The company uses a periodic inventory system, and its income tax rate is 35%. (Input all amounts as positive values. Cost of goods sold is the difference of Cost of goods available for sale and ending inventory. Round your per unit costs to 3 decimal places. Round your final answers to the nearest dollar amount. Omit the "$" sign in your response.) BOTCH CORP Income Statements Comparing FIFO, LIFO, and Weighted Average For Year Ended December 31, 2011 Weighted Averag FIFO LIFO (Click to select) Cost of s sold (Click to select) (Click to select) (Click to select) (Click to select) 9:17 PM Search the web and Windows 1 ») 11/15/2015

Explanation / Answer

2. Ending Inventory = Beginning inventory + purchased units - sold units
= 60 + 205 - 220 + 65 + 110 - 90 = 130 Units

3. a)

Value of inventory using FIFO is calculated as follows
FIFO is first in first out, which implies the units which bought in the begining are sold first, so all the units which are bought at the end are lying in the inventory
Among these 130 units, 110 units are bought for $62.20 on 25 March and remaining 20 are bought for $60.20 on 18 March
So value of inventory = 110 * 62.20 + 20 * 60.20 = $8,040

3. b)

Value of inventory using LIFO is calculated as follows
LIFO is Last in first out, which implies the units which bought in the end are sold first, so all the units which are bought in the begining are lying in the inventory
Among these 130 units, 60 units are bought for $50.20 on 1 March and remaining 70 are bought for $55.20 on 5 March
So value of inventory = 60 * 50.20 + 70 * 55.20 = $6,876

3. c)

Value of inventory using Weighted average is calculated as follows
Cost of goods sold is calculated as weighted average of all the purchases made in the period

So cost of goods purchased = (60 * 50.20 + 205 * 55.20 + 65 * 60.20 + 110 * 62.20) / (No. of units purchased)
= 25083 / 440 = $57.01
So value of inventory = 130 * 57.01 = $7,410.89

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