Obj. 2, 3 The beginning inventory at Midnight Supplies and data on purchases and sales for a three-month period ending March 31 are as SHOW ME HOW follows: PR 6-2A below EXCEL TEMPLATE Date Transaction Number Per Unit Total of Units Jan. 1 Inventory 7,500 $ 75.00 $ 562,500 10 Purchase 22,500 85.00 1,912,500 28 Sale 11,250 150.00 1,687,500 30 Sale 3,750 150.00 562,500 Feb. 5 Sale 1,500 150.00 225,000 10 Purchase 54,000 87.50 4,725,000 16 Sale 27,000 160.00 4,320,000 28 Sale 25,500 160.00 4,080,000 Mar. 5 Purchase 45,000 89.50 4,027,500 14 Sale 30,000 160.00 4,800,000 25 Purchase 7,500 90.00 675,000 30 Sale 26,250 160.00 4,200,000 Instructions Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the first-in, first-out method. Determine the total sales and the total cost of goods sold for the period. Journalize the entries in the sales and cost of goods sold accounts. Assume that all sales were on account. Determine the gross profit from sales for the period.

Q: How is Day Sales in Inventory calculated?

A: Inventory turnover ratio: This is a financial measure that is used to evaluate as to how many times…

Q: Identify the costs of merchandise inventory.

A: Merchandise Inventory: Merchandise is the stock of goods bought by a wholesaler, or a retailer, or a…

Q: How do I use FIFO and calculate the Cost of Goods and inventory ?

A: FIFO Method: FIFO method also referred to as First-In-First-Out method is an inventory management…

Q: Define inventory.

A: Inventory: Inventory consist of total of three components: raw material, work-in-process and…

Q: What is the formula used to determine the amount of merchandise inventory to be purchased?

A: To calculate amount of merchandise inventory to be purchased, we need opening inventory amount,…

Q: How do you find the ending inventory?

A: Many companies earn revenue by selling inventory rather than a service. These companies are…

Q: what is FIFO inventory method?

A: FIFO inventory method is one of the methods of calculation of value of ending Inventory and cost of…

Q: Ending/Beginning Ending Inventory Finished Goods Formula How do you find the beginning and the…

A: Finished goods inventory: It refers to the products in a manufacture’s inventory that are final…

Q: Donna MacIntosh runs Emerald Spa, a business providing women-only hairdressing, beauty, relaxation…

A: Internal control refers to the process of formulating new policies or rules in an organization in…

Q: Under what circumstances would the gross profit method of estimating inventory be used?

A: The gross profit method of estimating inventory is typically used in situations where a company…

Q: compute the number of units in ending inventory

A: Ending inventory represents the units of inventory that is remaining unsold as at a given date.…

Q: How to determine the inventory cost using the fifo and lifo

A: Inventory cost is the cost to incur handling charges,maintaining cost and storage cost with…

Q: What are the two main types of inventory and which is considered a physical count?

A: Inventory:   Inventory refers to the raw materials, work-in process, and the finished goods…

Q: Define beginning inventory and ending inventory

A: The beginning inventory and ending inventory are explained as below,   The Inventory can be defined…

Q: How did you get the inventory carrying cost please?

A: Lets understand the basics. Economic order quantity is a quantity at which carrying cost and…

Q: Determine the goods and costs included in inventory.

A: The cost included in inventory includes all the costs incurred to prepare such inventory for sale.…

Q: What is inventory conversion period?

A: Conversion period refers to the length of period at which one asset is converted into another form.…

Q: What is inventory shrinkage? What are some of the reasons for inventory shrinkage?

A: Inventory Shrinkage :  As the name suggests, it is considered as shrinking or shortening of…

Q: What does the cost of merchandise inventory includes?

A: Merchandise Inventory: Merchandise is the stock of goods bought by a wholesaler, or a retailer, or a…

Q: What are the four methods used to account for inventory?

A:

Q: What does the retail inventory estimates?

A: Retail inventory method:   The retail inventory method is used to calculate the value of ending…

Q: Are there different methods used to account for perpetual inventory?

A: Perpetual inventory is a continous estimation of the inventory balances based on our books of…

Q: s the cost of goods sold from the income statement part include the cost of goods in inventory?

A: Cost of Goods Sold=Beginning Inventory+Purchases for the period-Ending Inventory

Q: What factors contribute to (or cause) inventory shrinkage?

A: Shrinkage: The cost of the difference between the recorded inventory value and physical count of…

Q: How is the net cost of inventory calculated?

A: Merchandise Inventory: Merchandise is the stock of goods bought by a wholesaler, or a retailer, or a…

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.