Trends by Tiffany sells high-end leather purses. The company has the following inventory transactions for the year. Date Transactions Units Unit Cost Unit Cost Jan. 1 Beginning inventory 20 $500 $10,000 Apr. 9 Purchase 30 520 15,600 Oct. 4 Purchase 11 550 6,050 61 $31,650 Jan. 1–Dec. 31 Sales 52 Required:1. Using FIFO, calculate ending inventory and cost of goods sold.2. Using LIFO, calculate ending inventory and cost of goods sold.3. Because trends in purses change frequently, Trends by Tiffany estimates that the remaining nine purses have a net realizable value at December 31 of only $350 each. Determine the amount of ending inventory to report using lower of cost and net realizable value under FIFO. Record any necessary adjustment.
Trends by Tiffany sells high-end leather purses. The company has the following inventory transactions for the year. Date Transactions Units Unit Cost Unit Cost Jan. 1 Beginning inventory 20 $500 $10,000 Apr. 9 Purchase 30 520 15,600 Oct. 4 Purchase 11 550 6,050 61 $31,650 Jan. 1–Dec. 31 Sales 52 Required:1. Using FIFO, calculate ending inventory and cost of goods sold.2. Using LIFO, calculate ending inventory and cost of goods sold.3. Because trends in purses change frequently, Trends by Tiffany estimates that the remaining nine purses have a net realizable value at December 31 of only $350 each. Determine the amount of ending inventory to report using lower of cost and net realizable value under FIFO. Record any necessary adjustment.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter7: Inventories: Cost Measurement And Flow Assumptions
Section: Chapter Questions
Problem 11RE: Jessie Stores uses the periodic system of calculating inventory. The following information is...
Related questions
Question
Trends by Tiffany sells high-end leather purses. The company has the following inventory transactions for the year.
Date | Transactions | Units | Unit Cost | Unit Cost |
Jan. 1 | Beginning inventory | 20 | $500 | $10,000 |
Apr. 9 | Purchase | 30 | 520 | 15,600 |
Oct. 4 | Purchase | 11 | 550 | 6,050 |
61 | $31,650 | |||
Jan. 1–Dec. 31 | Sales | 52 |
Required:
1. Using FIFO, calculate ending inventory and cost of goods sold.
2. Using LIFO, calculate ending inventory and cost of goods sold.
3. Because trends in purses change frequently, Trends by Tiffany estimates that the remaining nine purses have a net realizable value at December 31 of only $350 each. Determine the amount of ending inventory to report using lower of cost and net realizable value under FIFO. Record any necessary adjustment.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 3 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Excel Applications for Accounting Principles
Accounting
ISBN:
9781111581565
Author:
Gaylord N. Smith
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Excel Applications for Accounting Principles
Accounting
ISBN:
9781111581565
Author:
Gaylord N. Smith
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781305088436
Author:
Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning