The image displays an inventory management exercise involving hammers, which includes data on beginning inventory, purchases, and sales. The following is a transcription and explanation suitable for an educational website:---**Inventory Management for Hammers:****Beginning Inventory, Purchases, and Sales Data:**- **March 3**: - Beginning Inventory: 12 units at $15 each- **Transactions:** - March 11: Purchase of 13 units at $17 each - March 19: Purchase of 9 units at $19 each - March 25: Purchase of 21 units at $20 each - March 29: Sale of 10 units**Objective:**Calculate the cost of goods sold and ending inventory using a perpetual inventory system under the following cost-flow assumptions:1. **First-in, First-out (FIFO)**2. **Last-in, First-out (LIFO)****Inventory Record Structure:**The inventory records are structured with columns for:- Date- Quantity (Qty.)- Unit Cost- Total CostThese are divided into sections for Purchases, Cost of Goods Sold, and Inventory Balances.### Method Definitions:- **FIFO (First-in, First-out):** Assumes the oldest inventory items are sold first. - **LIFO (Last-in, First-out):** Assumes the newest inventory items are sold first.The exercise requires completing inventory cards for each transaction date, detailing the flow of costs in and out of the system, and calculating the resulting balances in the inventory account.### Diagram Explanation:The diagram consists of a table with placeholders where calculations should be input for each transaction under both FIFO and LIFO assumptions. Each row represents a transaction or balance calculation.- **Purchases:** The quantities and costs of items acquired during the period.- **Cost of Goods Sold (COGS):** Reflects which items (and costs) have left inventory following sales.- **Inventory Balances:** Displays remaining quantities and costs after each transaction.This exercise is designed to help students understand practical applications of FIFO and LIFO in inventory management, emphasizing how these methods impact financial statements.---This explanation contextualizes the transcribed data for educational purposes, guiding learners through the inventory management process. ---### Cost of Goods Sold and Ending Inventory Calculation**EX7-8, EX7-9, EX7-10**Beginning inventory, purchases, and sales data for tennis rackets are as follows:- **April 3** - Beginning Inventory: 12 units @ $45 - Sold: 21 Units- **April 11 Purchases** - 15 units @ $47 - Sold: 18 Units- **April 21 Purchases** - 10 units @ $50 - Sold: 10 Units- **April 25 Sold** - Remaining Units Sold: 14 Units**Instructions:**Complete the inventory cost card assuming the business maintains a perpetual inventory system and determine the cost of goods sold and ending inventory using the weighted average cost method. Round your answers to two decimal places.#### Balances:- **Beginning Inventory on April 3** - Quantity: 25- **Updates for April 3, 11, 21, 25** - Calculate updates on quantities and costs for each transaction.#### Purchases:Fill out the table for each transaction, inputting the quantity, unit cost, and total cost for each purchase.#### Cost of Goods Sold (COGS):Complete the table to calculate the cost of goods sold, entering the quantity, unit cost, and total cost for each sale.#### Inventory:Maintain records of inventory, reflecting adjustments after each transaction.**Note:** Follow the format of entering data in the given slots, ensuring all calculations for each date are accurately recorded. Ensure all monetary values are calculated to two decimal places for precision.---

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Description: The image displays an inventory management exercise involving hammers, which includes data on beginning inventory, purchases, and sales. The following is a transcription and explanation suitable for an educational website:---**Inventory Management f

Business

Accounting

Mar. 3 Inventory 12 units @ $15 11 Purchase 13 units @ $17 14 Sale 18 units 21 Purchase 9 units @ $20 25 Sale 10 units Assuming the business maintains a perpetual inventory system, complete the inventory cards and calculate the cost of goods sold and ending inventory under the following assumptions: a. First-in, first-out Cost of Purchases Goods Sold Inventory Date Qty. Unit Cost Total Cost Qty. Unit Cost Total Cost Qty. Unit Cost Total Cost Maг. 3 $4 $4 11 24 24 14 24 21 25 Balances $4 Cost of goods sold Ending inventory b. Last-in, first-out Cost of Purchases Goods Sold Inventory Date Qty. Unit Cost Total Cost Qty. Unit Cost Total Cost Qty. Unit Cost Total Cost Mar. 3 $4 2$4 11

Mar. 3 Inventory 12 units @ $15 11 Purchase 13 units @ $17 14 Sale 18 units 21 Purchase 9 units @ $20 25 Sale 10 units Assuming the business maintains a perpetual inventory system, complete the inventory cards and calculate the cost of goods sold and ending inventory under the following assumptions: a. First-in, first-out Cost of Purchases Goods Sold Inventory Date Qty. Unit Cost Total Cost Qty. Unit Cost Total Cost Qty. Unit Cost Total Cost Maг. 3 $4 $4 11 24 24 14 24 21 25 Balances $4 Cost of goods sold Ending inventory b. Last-in, first-out Cost of Purchases Goods Sold Inventory Date Qty. Unit Cost Total Cost Qty. Unit Cost Total Cost Qty. Unit Cost Total Cost Mar. 3 $4 2$4 11

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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