Ch8 zto.mheducation.com/hm.tpx?0.087308844 22081253_1461512259844 leadlines UE U

Question

Ch8 zto.mheducation.com/hm.tpx?0.087308844 22081253_1461512259844 leadlines UE Us Magazine O Direct Advantage Call..."o Viamedia dashboard G Google Spam Control M& NBCNes K Q IThe following information applies to the questions displayed below] At the end of January 2011, the records of Donner Company showed the ollowing for a particular item that sold at $17 per unit Transactions Inventory, January 1, 2011 Purchase, January 12 Purchase. January 26 Sale Sale Units Amount 493 $2.465 604 3.624 152 1216 (360) (242) valie 15.00 points

Explanation / Answer

Closing Inventory Units = Opening Stock + purchases - Sales

= 493 + (604+152) - (360+242) = 647 units

Calculation of Value of closing stock:

1. Average cost per unit = (2465 + 3624 + 1216) / (493 + 604 + 152)

= $7305 / 1249 = $5.85

Inventory value = $5.85 * 647 = $3784.95

2. FIFO = Inventory value = $1216 + 3624/604 * 495 units = $4186

3. LIFO = Inventory value = $2465 + 3624/604 * 154 units = $3389

4. Specific Identification = (490 - 363)units @ $2465/493 + (604-242) * 3624/604 + $1216 = $635 + $2172 + $1216 = $4023

1a. Cost of goods sold = Opening Stock + Purchases - Closing Stock

1. Average Cost Method = $2465 + $(3624+1216) - $3784.95 = $3520.05

2. FIFO = $2465 + $(3624+1216) - $4186 = $3119

3. LIFO = $2465 + $(3624+1216) - $3389 = $3916

4. Specific Identification Method = $2465 + $(3624+1216) - $4023 = $3282

1b. Income Statement: ($) Average Cost Method FIFO LIFO Specific Identification

Sales ($17*602) 10234 10234 10234   10234

Less Cost of goods sold 3520.05     3119 3916 3282

Gross Profit 6713.95 7115 6318 6952

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---