FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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There are 20 units of inventory on hand on December 31.
1. Calculate the total amount to be assigned to the ending inventory under each of the following periodic inventory methods:
a. FIFO
b. Weighted-average (round calculations to two decimal places)
2. Assume that the market price per unit (cost to replace) of Bouie's inventory on December 31, 20--, was $39. Calculate
the total amount to be assigned to the ending inventory on December 31 under each of the following methods:
a. FIFO lower-of-cost-or-market
$4
b. Weighted-average lower-of-cost-or-market
$4
3. What journal entry would be made under lower-of-cost-or-market for parts 2(a) FIFO and 2(b) Weighted-average? If no
entry is required, select "No Entry Required".
а.
b.
Transcribed Image Text:Chapter 13-14-15 Homework
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Lower-of-Cost-or-Market
Bouie Company's beginning inventory and purchases during the fiscal year ended December 31, 20--, were as follows:
Units
Unit Price
Total Cost
Jan. 1
Beginning inventory
20
$27
$540
Mar. 5
1st purchase
22
34
748
Sept. 9 2nd purchase
24
35
840
Dec. 8
3rd purchase
22
40
880
88
$3,008
There are 20 units of inventory on hand on December 31.
1. Calculate the total amount to be assigned to the ending inventory under each of the following periodic inventory methods:
a. FIFO
b. Weighted-average (round calculations to two decimal places)
$4
2. Assume that the market price per unit (cost to replace) of Bouie's inventory on December 31, 20--, was $39. Calculate the total amount to be assigned to
the ending inventory on December 31 under each of the following methods:
a. FIFO lower-of-cost-or-market
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