In October, Nicole eliminated all existing Inventory of cosmetic items. The trouble of ordering and tracking each productline had exceeded the profits earned. In December, a supplier asked her to sell a prepackaged spa kit. Feeling she couldmanage a single product line, Nicole agreed. Nicole's Getaway Spa (NGS) would make monthly purchases from thesupplier at a cost that included production costs and a transportation charge. NGS would keep track of its new inventoryusing a perpetual Inventory system.On December 31 of last year, NGS had 20 units at a total cost of $5.50 per unit. Nicole purchased 40 more units at $7.50in February. In March, Nicole purchased 20 units at $9.50 per unit. In May, 50 units were purchased at $9.30 per unit. InJune, NGS sold 50 units at a selling price of $11.50 per unit and 60 units at $11.30 per unit.2. 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" to 2 decimal places.)FIFO (Perpetual)Beginning InventoryPurchasesFebruaryMarchMayNet PurchasesGoods Available for Sale iCost of Goods SoldUnits from Beginning InventoryUnits from February PurchaseUnits from March PurchaseUnits from May PurchaseUnitsCost perUnitTotal

Under the FIFO method, the inventory that is purchased at first is sold first. So, in a period of…

Answered: 2. Compute the Cost of Goods Available…

2. 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" to 2 decimal places.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Overheads

In cost accounting, overhead refers to those expenses which occur during the operating of a business. Overhead includes the fixed, variable, or semi-variable which is not directly involved with a company product or service. It is very important to analyze overhead expense as it helps the company in determining how much a company must charge for its products and services so that they can generate profit. Overhead expenses depend upon the nature of the business operations.

Question

In October, Nicole eliminated all existing Inventory of cosmetic items. The trouble of ordering and tracking each product
line had exceeded the profits earned. In December, a supplier asked her to sell a prepackaged spa kit. Feeling she could
manage a single product line, Nicole agreed. Nicole's Getaway Spa (NGS) would make monthly purchases from the
supplier at a cost that included production costs and a transportation charge. NGS would keep track of its new inventory
using a perpetual Inventory system.
On December 31 of last year, NGS had 20 units at a total cost of $5.50 per unit. Nicole purchased 40 more units at $7.50
in February. In March, Nicole purchased 20 units at $9.50 per unit. In May, 50 units were purchased at $9.30 per unit. In
June, NGS sold 50 units at a selling price of $11.50 per unit and 60 units at $11.30 per unit.
2. 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" to 2 decimal places.)
FIFO (Perpetual)
Beginning Inventory
Purchases
February
March
May
Net Purchases
Goods Available for Sale i
Cost of Goods Sold
Units from Beginning Inventory
Units from February Purchase
Units from March Purchase
Units from May Purchase
Units
Cost per
Unit
Total

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