Assume that Dunk Coffee Shop completed the following periodic inventory transactions for a line of merchandiseâ inventory:
Jun.
1
Beginning merchandise inventory
25
units @
$22
each
12
Purchase
3
units @
$24
each
20
Sale
14
units @
$34
each
24
Purchase
17
units @
$28
each
29
Sale
20
units @
$34
each
1.
Compute ending merchandiseâ inventory, cost of goodsâ sold, and gross profit using the FIFO inventory costing method.
2.
Compute ending merchandiseâ inventory, cost of goodsâ sold, and gross profit using the LIFO inventory costing method.
3.
Compute ending merchandiseâ inventory, cost of goodsâ sold, and gross profit using theâ weighted-average inventory costing method.â (Round weighted-average cost per unit to the nearest cent and all other amounts to the nearestâ dollar.)
QUESTION: Compute ending merchandiseâ inventory, cost of goodsâ sold, and gross profit using theâ (1) FIFO inventory costingâ method, (2) LIFO inventory costingâ method, andâ (3) weighted-average inventory costing method.â (Round weighted-average cost per unit to the nearest cent and all other amounts to the nearestâ dollar.)
Begin by determining ending merchandise inventory and cost of goods sold under each of the three methods.
Requirement 1.
FIFO
Plus:
Less:
Cost of goods sold
Requirement 2.
LIFO
Requirement 3.
Weighted-Average
Now compute the gross profit under each inventory costing method.
Requirement 1.
FIFO
Sales Revenue
Cost of Goods Sold
Gross Profit
Requirement 2.
LIFO
.
Requirement 3.
Weighted-Average
Assume that Dunk Coffee Shop completed the following periodic inventory transactions for a line of merchandiseâ inventory:
| Jun. | 1 | Beginning merchandise inventory | 25 | units @ | $22 | each |
| 12 | Purchase | 3 | units @ | $24 | each | |
| 20 | Sale | 14 | units @ | $34 | each | |
| 24 | Purchase | 17 | units @ | $28 | each | |
| 29 | Sale | 20 | units @ | $34 | each |
| 1. | Compute ending merchandiseâ inventory, cost of goodsâ sold, and gross profit using the FIFO inventory costing method. |
| 2. | Compute ending merchandiseâ inventory, cost of goodsâ sold, and gross profit using the LIFO inventory costing method. |
| 3. | Compute ending merchandiseâ inventory, cost of goodsâ sold, and gross profit using theâ weighted-average inventory costing method.â (Round weighted-average cost per unit to the nearest cent and all other amounts to the nearestâ dollar.) |
QUESTION: Compute ending merchandiseâ inventory, cost of goodsâ sold, and gross profit using theâ (1) FIFO inventory costingâ method, (2) LIFO inventory costingâ method, andâ (3) weighted-average inventory costing method.â (Round weighted-average cost per unit to the nearest cent and all other amounts to the nearestâ dollar.)
Begin by determining ending merchandise inventory and cost of goods sold under each of the three methods.
| Requirement 1. | ||
| FIFO | ||
| Plus: | ||
| Less: | ||
| Cost of goods sold | ||
| Requirement 2. |
| LIFO |
| Requirement 3. |
| Weighted-Average |
Now compute the gross profit under each inventory costing method.
| Requirement 1. | ||
| FIFO | ||
| Sales Revenue | ||
| Cost of Goods Sold | ||
| Gross Profit | ||
| Requirement 2. |
| LIFO |
| . | ||||
| Requirement 3. |
| Weighted-Average |
Related questions
| Periodic Inventory Method | |||||||||
| Better Bottles, Inc. uses a PERIODIC inventory system and has the following information available: | |||||||||
| Description | # of Units | Cost per Unit | Total Cost | ||||||
| Beginning inventory | 20 | $20.00 | $400 | ||||||
| Jan 5 sold | 15 | ||||||||
| Jan 15 purchase | 27 | $22.00 | 594 | ||||||
| Jan 18 sold | 21 | ||||||||
| Jan 20 purchase | 33 | $30.00 | 990 | ||||||
| Total goods available for sale | 80 | $1,984 | |||||||
| Total goods sold | 36 | ||||||||
| Required: | |||||||||
| 1 | Calculate both Cost of goods sold and Ending inventory using the Periodic FIFO Method. | ||||||||
| 2 | Calculate both Cost of good sold and Ending Inventory using Periodic LIFO Method. | ||||||||
| 3 | Use your calculations from 1-2 and complete the Income Statement. | ||||||||
| The company income tax rate: | 0.25 | ||||||||
| 1 | FIFO Cost of Goods Sold - PERIODIC | ||||||||
| Units Sold Taken From: | # of Units | Cost per Unit | Total Cost | ||||||
| Total Cost of Goods Sold FIFO | |||||||||
| FIFO Ending Inventory - PERIODIC | |||||||||
| Inventory Available | # of Units | Cost per Unit | Total Cost | ||||||
| Beginning inventory | |||||||||
| +Purchase | |||||||||
| +Purchase | |||||||||
| (Less Cost of Goods Sold) | |||||||||
| Ending Inventory FIFO | |||||||||
| 2 | LIFO Cost of Goods Sold - PERIODIC | ||||||||
| Units Sold Taken From: | # of Units | Cost per Unit | Total Cost | ||||||
| Total Cost of Goods Sold LIFO | |||||||||
| LIFO Ending Inventory - PERIODIC | |||||||||
| Inventory Available | # of Units | Cost per Unit | Total Cost | ||||||
| Beginning inventory | |||||||||
| +Purchase | |||||||||
| +Purchase | |||||||||
| (Less Cost of Goods Sold) | |||||||||
| Ending Inventory LIFO | |||||||||
| 3 | Income Statement - Periodic Inventory Method | ||||||||
| FIFO | LIFO | ||||||||
| Sales revenue, net | 25,000 | 25,000 | |||||||
| Cost of goods sold | |||||||||
| Gross profit | |||||||||
| Operating expenses | 8,000 | 8,000 | |||||||
| Operating income before tax | |||||||||
| Income tax expense | |||||||||
| Net income | |||||||||
3. Beginning inventory, purchases andsales data for widgets are as follows:
Apr 3 | Inventory | 15 units | @ | $30 | |
11 | Purchase | 12 units | @ | $27 | |
14 | Sale | 18 units | |||
21 | Purchase | 7 units | @ | $25 | |
25 | Sale | 10 units | |||
Complete the inventory cost card assuming the business maintains aperpetual inventory system and calculates thecost of merchandise sold and ending inventory usingFIFO.
| Cost of |
| |||||||
Date | Qty | Unit Cost | Total Cost | Qty | Unit Cost | Total Cost | Qty | Unit Cost | Total Cost |
Balances | |||||||||
| 4. Complete the chart using the LIFO andFIFO costing methods, assuming a period of increasingcosts:
|
