Cost flow assumptions: Cost flow assumptions can be referred to as the method which determines the flow of costs when an inventory is sold. Instead of keeping a track record for cost of each product sold, a company adopts these methods, and identifies which units were sold. It differs from specific identification method because the actual physical movement of goods may be unrelated to the flow of costs. To determine: Gross profit and ending inventory under First-in-first out (FIFO) method.

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Answer 1

Question

Chapter 6, Problem 6.1APE

(a)

To determine

Cost flow assumptions:

Cost flow assumptions can be referred to as the method which determines the flow of costs when an inventory is sold. Instead of keeping a track record for cost of each product sold, a company adopts these methods, and identifies which units were sold. It differs from specific identification method because the actual physical movement of goods may be unrelated to the flow of costs.

To determine: Gross profit and ending inventory under First-in-first out (FIFO) method.

(b)

To determine

Gross profit and ending inventory under Last-in-first out (LIFO) method.

(c)

To determine

Gross profit and ending inventory under weighted average inventory method.

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Ch 9 Problem Set B Problem 9-1 Part B The company uses the perpetual inventory method. It began the month of March with 100 units of inventory, at a unit cost of $55. Purchases during March March 5, 60 units at $60 each. March 18, 200 units at $65 each March 29, 40 units at $75 each. Sales during March March 12, 60 units. March 25, 210 units. All units were sold to customer for $100 each. 1. Use the following format to set up this inventory costing problem, as shown in Video #2. Inventory Date Units Cost per Total Cost Date Units Total Cost Unit Beg Balance Units Cost Beginning Balance + Purchases Goods Available for Sale - Sold Ending Balance

Hopkins Company reported the following information related to inventory and sales: Units Unit Cost Beginning inventory 2,200 $20 Purchase Number 18, 200 22 Purchase Number 23,200 23 Sales -10,400 units at $35 per unit. Required: Compute the following amounts: sales revenue, cost of goods sold, gross prodit, and balance sheet invenetory for avereage costing method, fifo, and lifo

The following are the transactions for the month of July. Units July 1 July 13 Beginning Inventory Purchase July 25 July 31 Sold 50 250 (100) Unit Cost $ 10 Unit Selling Price 13 $ 15 Ending Inventory 200 Required: a. Calculate cost of goods available for sale and ending inventory under weighted average cost. Assume a periodic inventory system is used. b. Calculate sales, cost of goods sold, and gross profit, under weighted average cost. Assume a periodic inventory system is used. Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required A Required B Calculate cost of goods available for sale and ending inventory under weighted average cost. Assume a periodic inventory system is used. (Round "Cost per Unit" to 2 decimal places.) Weighted Average (Periodic) Units Cost per Unit Total Beginning Inventory 50 $ 10.00 $ 500 Purchases 250 $ 13.00 $ 3,250 Goods Available for Sale 3,750 Cost of Goods Sold 100 S 0.00 X 0

Answer 2

Question

Chapter 6, Problem 6.1APE

(a)

To determine

Cost flow assumptions:

Cost flow assumptions can be referred to as the method which determines the flow of costs when an inventory is sold. Instead of keeping a track record for cost of each product sold, a company adopts these methods, and identifies which units were sold. It differs from specific identification method because the actual physical movement of goods may be unrelated to the flow of costs.

To determine: Gross profit and ending inventory under First-in-first out (FIFO) method.

(b)

To determine

Gross profit and ending inventory under Last-in-first out (LIFO) method.

(c)

To determine

Gross profit and ending inventory under weighted average inventory method.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 6, Problem 6.1APE

(a)

To determine

Cost flow assumptions:

Cost flow assumptions can be referred to as the method which determines the flow of costs when an inventory is sold. Instead of keeping a track record for cost of each product sold, a company adopts these methods, and identifies which units were sold. It differs from specific identification method because the actual physical movement of goods may be unrelated to the flow of costs.

To determine: Gross profit and ending inventory under First-in-first out (FIFO) method.

(b)

To determine

Gross profit and ending inventory under Last-in-first out (LIFO) method.

(c)

To determine

Gross profit and ending inventory under weighted average inventory method.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 6, Problem 6.1APE

(a)

To determine

Cost flow assumptions:

Cost flow assumptions can be referred to as the method which determines the flow of costs when an inventory is sold. Instead of keeping a track record for cost of each product sold, a company adopts these methods, and identifies which units were sold. It differs from specific identification method because the actual physical movement of goods may be unrelated to the flow of costs.

To determine: Gross profit and ending inventory under First-in-first out (FIFO) method.

(b)

To determine

Gross profit and ending inventory under Last-in-first out (LIFO) method.

(c)

To determine

Gross profit and ending inventory under weighted average inventory method.

Expert Solution & Answer

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Answer 5

Chapter 6, Problem 6.1APE

(a)

To determine

Cost flow assumptions:

Cost flow assumptions can be referred to as the method which determines the flow of costs when an inventory is sold. Instead of keeping a track record for cost of each product sold, a company adopts these methods, and identifies which units were sold. It differs from specific identification method because the actual physical movement of goods may be unrelated to the flow of costs.

To determine: Gross profit and ending inventory under First-in-first out (FIFO) method.

(b)

To determine

Gross profit and ending inventory under Last-in-first out (LIFO) method.

(c)

To determine

Gross profit and ending inventory under weighted average inventory method.

Answer 6

Chapter 6, Problem 6.1APE

(a)

To determine

Cost flow assumptions:

Cost flow assumptions can be referred to as the method which determines the flow of costs when an inventory is sold. Instead of keeping a track record for cost of each product sold, a company adopts these methods, and identifies which units were sold. It differs from specific identification method because the actual physical movement of goods may be unrelated to the flow of costs.

To determine: Gross profit and ending inventory under First-in-first out (FIFO) method.

Answer 7

Chapter 6, Problem 6.1APE

(a)

To determine

Cost flow assumptions:

Cost flow assumptions can be referred to as the method which determines the flow of costs when an inventory is sold. Instead of keeping a track record for cost of each product sold, a company adopts these methods, and identifies which units were sold. It differs from specific identification method because the actual physical movement of goods may be unrelated to the flow of costs.

To determine: Gross profit and ending inventory under First-in-first out (FIFO) method.

Answer 8

(b)

To determine

Gross profit and ending inventory under Last-in-first out (LIFO) method.

Answer 9

(b)

To determine

Gross profit and ending inventory under Last-in-first out (LIFO) method.

Answer 10

(c)

To determine

Gross profit and ending inventory under weighted average inventory method.

Answer 11

(c)

To determine

Gross profit and ending inventory under weighted average inventory method.

Answer 12

Expert Solution & Answer

Answer 13

Expert Solution & Answer

Answer 14

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Answer 15

Ch. 6 - Before inventory purchases are recorded, the...Ch. 6 - Why is it important to periodically take a...Ch. 6 - Do the terms FIFO, LIFO, and weighted average...Ch. 6 - If inventory is being valued at cost and the price...Ch. 6 - Which of the three methods of inventory...Ch. 6 - If inventory is being valued at cost and the price...Ch. 6 - Using the following data, how should the inventory...Ch. 6 - Prob. 8DQ Ch. 6 - Hutch Co. sold merchandise to Bibbins Company on...Ch. 6 - A manufacturer shipped merchandise to a retailer...

Solution Summary: The author explains the cost flow assumptions, which determine the flow of costs when an inventory is sold.

Concept explainers

Videos

Gross profit and ending inventory under Last-in-first out (LIFO) method.

Gross profit and ending inventory under weighted average inventory method.

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Chapter 6 Solutions