FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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- es Warnerwoods Company uses a periodic inventory system. It entered into the following purchases and sales transactions for March. Date March 1 Activities March 5 Beginning inventory Purchase March 9 Sales March 18 March 25 Purchase Purchase March 29 Sales Totals Units Acquired at Cost 115 units @ $50 per unit 415 units @ $55 per unit 150 units @$60 per unit 230 units @ $62 per unit 910 units. Units Sold at Retail 435 units @ $85 per unit 190 units @ $95 per unit 625 units For specific identification, units sold include 50 units from beginning inventory, 385 units from the March 5 purchase, 55 units from the March 18 purchase, and 135 units from the March 25 purchase. 4. Compute gross profit earned by the company for each of the four costing methods. Note: Round your average cost per unit to 2 decimal places and final answers to nearest whole dollar. FIFO LIFO Weighted Average Specific Identification Sales Less: Cost of goods sold Gross profit $ 0 $ 0 $ 0 $ 0arrow_forwardWarnerwoods Company uses a perpetual inventory system. It entered into the following purchases and sales transactions for March. Date Activities Units Acquired at Cost 80 units @ $50.60 per unit 215 units @ $55.60 per unit Units Sold at Retail March 1 March 5 March 9 March 18 Beginning inventory Purchase Sales Purchase 240 units @ s85.60 per unit 75 units @ $60.60 per unit 130 units @ $62.60 per unit March 25 Purchase March 29 Sales 110 units @ $95.60 per unit Totals 500 units 350 units ok Problem 5-1A (Algo) Part 4 it 4. Compute gross profit earned by the company for each of the four costing methods. For specific identification, units sold include 55 units from beginning inventory, 185 units from the March 5 purchase, 35 units from the March 18 purchase, and 75 units from the March 25 purchase. (Round weighted average cost per unit to two decimals and final answers to nearest whole dollar.) nces Weighted Average Gross Margin FIFO LIFO Specific ID Sales Less: Cost of goods sold Gross…arrow_forwardLaker Company reported the following January purchases and sales data for its only product. The Company uses a perpetual inventory system. For specific identification, ending inventory consists of 270 units from the January 30 purchase, 5 units from the January 20 purchase, and 15 units from beginning inventory. 28 Date January 1 January 10 January 20 January 25 January 30 Required: S ual Activities Beginning inventory Sales Purchase Sales Purchase Totals Units Acquired at Cost 180 units @ $ 10.50 = 110 units @ Units sold at Retail $ 1,890 140 units @ $ 19.50 $9.50- 1,045 130 units @ $ 19.50 270 units @ 560 units $ 9.00 = 2,430 $ 5,365 270 units 1. Compute gross profit for the month of January for Laker Company for the four inventory methods. 2. Which method yields the highest gross profit? 3. Does gross profit using weighted average fall between that using FIFO and LIFO? 4. If costs were rising instead of falling, which method would yield the highest gross profit? งarrow_forward
- Warnerwoods Company uses a perpetual inventory system. It entered into the following purchases and sales transactions for March. Units Sold at Retail Units Acquired at Cost 100 units @ $50 per unit 400 units@ $55 per unit Date Mar. Mar. Mar. Mar. 18 Purchase Mar. 25 Purchase Mar. 29 Sales Activities 1 Beginning inventory 5 Purchase 9 Sales 420 units @ $85 per unit 120 units @ $60 per unit 200 units @ $62 per unit 160 units @ $95 per unit Totals 820 units 580 units 3. 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 80 units from beginning inventory and 340 units from the March 5 purchase; the March 29 sale consisted of 40 units from the March 18 purchase and 120 units from the March 25 purchase. es Complete this question by einering your answers in the tabs below. Perpetual FIFO Perpetual LIFO Weighted Average Specific Id Compute the cost assigned to…arrow_forwardABC Company employs a periodic inventory system and sells its inventory to customers for $20 per unit. ABC Company had the following inventory information available for May: May 1 May 3 May 8 May 13 May 18 May 20 May 24 May 30 Beginning inventory 1,900 units @ $10.20 cost per unit Purchased 2,100 units @ $11.60 cost per unit Sold 1,400 units Purchased 3,700 units $8.10 cost per unit Sold 2,600 units Purchase 4,100 units @ $14.70 cost per unit Sold 2,900 units Purchased 2,200 units @ $12.60 cost per unit During May, ABC Company reported operating expenses of $14,000 and had an income tax rate of 36%. Calculate the dollar amount of ending inventory shown on ABC Company's May 31 balance sheet using the FIFO method.arrow_forwardMontoure Company uses a perpetual inventory system. It entered into the following calendar-year purchases and sales transactions. Date Activities Units Acquired at Cost Units Sold at Retail January 1 Beginning inventory 700 units @ $50 per unit February 10 Purchase 300 units @ $46 per unit March 13 Purchase 100 units @ $40 per unit March 15 Sales 780 units @ $70 per unit August 21 Purchase 110 units @ $55 per unit September 5 Purchase 570 units @ $52 per unit September 10 Sales 680 units @ $70 per unit Totals 1,780 units 1,460 units Required:1. Compute cost of goods available for sale and the number of units available for sale. 2. Compute the number of units in ending inventory Compute the cost assigned to ending inventory using (a) FIFO, (b) LIFO, (c) weighted average, and (d) specific identification. (For specific identification, units sold consist of 700 units from beginning inventory, 200 from the February…arrow_forward
- Plz explain in detailarrow_forwardABC Company employs a periodic inventory system and sells its inventory to customers for $20 per unit. ABC Company had the following inventory information available for May: May 1 May 3 May 8 May 13 May 18 May 20 May 24 May 30 Beginning inventory 1,900 units @ $10.20 cost per unit Purchased 2,100 units @ $11.60 cost per unit Sold 1,400 units Purchased 3,700 units @ $8.10 cost per unit Sold 2,600 units Purchase 4,100 units @ $14.70 cost per unit Sold 2,900 units Purchased 2,200 units @ $12.60 cost per unit During May, ABC Company reported operating expenses of $14,000 and had an income tax rate of 36%. Calculate the amount of net income shown on ABC Company's income statement for May using the LIFO method.arrow_forwardAshavinbhaiarrow_forward
- ces Montoure Company uses a periodic inventory system. It entered into the following calendar-year purchases and sales transactions. Date Activities January 1 Beginning inventory February 10 Purchase March 13 Purchase March 15 Sales August 21 Purchase September 5 Purchase September 10 Sales Totals Units Acquired at Cost Units Sold at Retail 685 units @$45.00 per unit 570 units @ $42.00 per unit 285 units @ $27.00 per unit 1,140 units @ $75.00 per unit 185 units 585 units @ $50.00 per unit @ $46.00 per unit 2,310 units 770 units @ $75.00 per unit 1,910 units Required: 1. Compute cost of goods available for sale and the number of units available for sale. Cost of goods available for sale Number of units available for sale 2. Compute the number of units in ending inventory. Ending inventory units unitsarrow_forwardWaterway Company had a beginning inventory on January 1 of 180 units of Product 4-18-15 at a cost of $20 per unit. During the year, purchases were as follows. Mar. 15 July 20 450 units 320 units (a) at $23 at $25 Sept. 4 Dec. 2 Determine the cost of goods available for sale. The cost of goods available for sale Waterway Company uses a periodic inventory system. Sales totaled 1,180 units. $ 350 units $27 100 units at $29 atarrow_forwardCrane Company uses a perpetual inventory system and reports the following for the month of June. Date June 1 (a1) 12 23 30 June 1 June 12 June 15 June 23 Explanation Units Unit Cost Inventory Purchase June 27 Purchase Inventory $ $ $ eTextbook and Media 120 Save for Later 360 Calculate the weighted-average cost per unit, using a perpetual inventory system. Assume a sale of 400 units occurred on June 15 for a selling price of $9 and a sale of 50 units on June 27 for $10. (Round intermediate calculations to O decimal places, e.g. 152 and final answers to 3 decimal places, e.g. 5.125.) 170 200 $5 6 7 Total Cost $600 2,160 1,190 Attempts: 0 of 6 used Submit Answerarrow_forward
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