Periodic Inventory by Three Methods The units of an tem available for sale during the year were as follows: Jan. 1 Inventory 4 units at $50 Feb. 17 Purchase 8 units at $51 Jul. 21 Purchase 16 units at $53 Nov. 23 Purchase 19 units at $54 There are 14 units of the item in the physical inventory at December 31. The periodic inventory system is used. Round average unit cost to two decimals and final answers to the nearest whole dollar, if required. a. Determine the inventory cost by the first-in, fiest-out method. b. Determine the inventory cost by the last-in, first-out method. c. Determine the inventory cost by the weighted average cost method.

Periodic Inventory by Three Methods The units of an tem available for sale during the year were as follows: Jan. 1 Inventory 4 units at $50 Feb. 17 Purchase 8 units at $51 Jul. 21 Purchase 16 units at $53 Nov. 23 Purchase 19 units at $54 There are 14 units of the item in the physical inventory at December 31. The periodic inventory system is used. Round average unit cost to two decimals and final answers to the nearest whole dollar, if required. a. Determine the inventory cost by the first-in, fiest-out method. b. Determine the inventory cost by the last-in, first-out method. c. Determine the inventory cost by the weighted average cost method.

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Description: Periodic Inventory by Three MethodsThe units of an item available for sale during the year were as follows:Jan. 1 Inventory4 units at $50Feb. 17 Purchase8 units at $51Jul. 21 Purchase16 units at $53Nov. 23 Purchase19 units at $54There are 14 units o

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 12E: Alternative Inventory Methods Park Companys perpetual inventory records indicate the following...

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Hurst Companys beginning inventory and purchases during the fiscal year ended December 31, 20-2, were as follows: There are 1,200 units of inventory on hand on December 31, 20-2. REQUIRED 1. Calculate the total amount to be assigned to the cost of goods sold for 20-2 and ending inventory on December 31 under each of the following periodic inventory methods: (a) FIFO (b) LIFO (c) Weighted-average (round calculations to two decimal places) 2. Assume that the market price per unit (cost to replace) of Hursts inventory on December 31 was 18. Calculate the total amount to be assigned to the ending inventory on December 31 under each of the following methods: (a) FIFO lower-of-cost-or-market (b) Weighted-average lower-of-cost-or-market 3. In addition to taking a physical inventory on December 31, Hurst decides to estimate the ending inventory and cost of goods sold. During the fiscal year ended December 31, 20-2, net sales of 100,000 were made at a normal gross profit rate of 35%. Use the gross profit method to estimate the cost of goods sold for the fiscal year ended December 31 and the inventory on December 31.
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Calculate the cost of goods sold dollar value for A67 Company for the month, considering the following transactions under three different cost allocation methods and using perpetual inventory updating. Provide calculations for weighted average (AVG).
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Alternative Inventory Methods Park Companys perpetual inventory records indicate the following transactions in the month of June: Required: 1. Compute the cost of goods sold for June and the inventory at the end of June using each of the following cost flow assumptions: a. FIFO b. LIFO c. Average cost (Round unit costs to 3 decimal places and other amounts to the nearest dollar.) 2. Next Level Why are the cost of goods sold and ending inventory amounts different for each of the three methods? What do these amounts tell us about the purchase price of inventory during the year? 3. Next Level Which method produces the most realistic amount for net income? For inventory? Explain your answer. 4. Next Level If Park uses IFRS, which of the previous alternatives would be acceptable and why?
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