II. Home Gifts, Inc. had cash sales of $112,500 for Year 1, its first year of oe
ID: 2508112 • Letter: I
Question
II. Home Gifts, Inc. had cash sales of $112,500 for Year 1, its first year of oer April 2, the company purchased 150 units of inventory at $180 per unit.units on an additional 200 units were purchased for $200 per unit. The company hand at the end of the year. All transactions are cash transactions. a. Compute cost of goods sold using FIFO b. Compute gross margin under LIFO FIFO calculations III. The following data pertain to the petty cash fund of Marsh Company March Company established a petty cash fund of $ 250 on March 1.On March 31, the fund contained $13 of cash and vouchers for the following cash payments. Postage stamps: $21 Delivery charges: $93 .Meals allowances: $120 a. Prepare the journal entries to establish the petty cash fund b. Recognizing the expenses along with any shortfall and replenish the fund. CREDIT TYPE+ DEBIT EVENT ACCOUNTS a. b.Explanation / Answer
II a. Cost of goods Sold using FIFO
b. Gross Margin under LIFO
Gross Margin = Sales - Cost of goods Sold
=> $112,500 - $58,000 = $54,500
III. Petty Cash Journal entries
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Date Description Amount April 2 Purchases (150 x $180) $27,000 September 1 Purchases (200 x $200) $40,000 Total Purchases $67,000 Less : Ending Inventory (50 x $200) $10,000 Cost of Goods Sold $57,000