Financial Accounting
3rd Edition
ISBN: 9780133791129
Author: Jane L. Reimers
Publisher: Pearson Higher Ed
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Textbook Question
Chapter 5B, Problem 3EA
Estimate inventory. (LO 9). The following information is available for the Arizona Chemical Supply Company:
Estimate the cost of goods sold for January and the ending inventory at January 31, 2009.
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[The following information applies to the questions displayed below.]
A company reports the following beginning inventory and two purchases for the month of January. On January 26, the
company sells 300 units. Ending inventory at January 31 totals 130 units.
Beginning inventory on January 1
Purchase on January 9
Purchase on January 25
Assume the perpetual inventory system is used. Determine the costs assigned to ending inventory when costs are assigned based on
the LIFO method.
Date
Assume the perpetual inventory system is used. Determine the costs assigned to ending inventory when costs are assigned based on
the LIFO method.
January 1
January 9
Total January 9
January 25
Total January 25
January 26
Total January 26
Goods purchased
Units
270
60
100
# of units
Unit Cost
$ 2.50
2.70
2.84
Cost per # of units
unit
sold
Perpetual LIFO:
Cost of Goods Sold
Cost per
unit
Cost of Goods
Sold
# of units
Inventory Balance
Cost per
unit
Inventory
Balance
Lee Ltd. has the following units and costs for the month of April.
Beginning inventory, April 1, 1,000 units at $20 (Cost)
Purchase 1, April 9, 1,200 units at $23 (cost)
Sold 1, April 12, 2,100 units at $40 (Retail)
Purchase 2, April 22, 800 units at $25 (Cost)
If Lee uses a periodic inventory system, what is the cost of goods sold under FIFO at April 30?
a.$18,000
b.$22,300
c.$45,300
d.$49,600
Lee Ltd. has the following units and costs for the month of April.
Beginning inventory, April 1, 1,000 units at $20 (Cost)
Purchase 1, April 9, 1,200 units at $23 (cost)
Sold 1, April 12, 2,100 units at $40 (Retail)
Purchase 2, April 22, 800 units at $25 (Cost)
If Lee uses a periodic inventory system, what is the cost of ending inventory under weighted average at April 30? (Note: Use four decimal places for per-unit calculations and round all other numbers to the nearest dollar.)
a.$20,280
b.$22,164
c.$45,436
d.$47,320
Chapter 5B Solutions
Financial Accounting
Ch. 5B - Suppose Base Company began May with inventory of...Ch. 5B - Estimate inventory. (LO 9). Fantasy Games, Inc.,...Ch. 5B - (Estimate inventory. (LO 9). Knick-Knacks wants to...Ch. 5B - Estimate inventory. (LO 9). The following...Ch. 5B - Estimate inventory. (LO 9). The records of Florida...Ch. 5B - Estimate inventory. (LO 9). Hines Fruit Corp....Ch. 5B - Estimate inventory. (LO 9). Carries Cotton Candy...
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