Use the following information from Tidewater Merchandising Company for the month
ID: 2462307 • Letter: U
Question
Use the following information from Tidewater Merchandising Company for the month of June to answer questions 1–6:
June 1 Beginning inventory
75 units at $25 each
June 3 Purchase
348 units at $27 each
June 8 Sale
300 units
June 15 Purchase
257 units at $28 each
June 23 Sale
275 units
1. Assume that Tidewater uses a perpetual first-in, first-out inventory system. Determine the value of its ending inventory.
2. Assume that Tidewater uses a periodic first-in, first-out inventory system. Determine the value of its ending inventory.
3. Assume that Tidewater uses a perpetual last-in, first-out inventory system. Determine the value of its ending inventory.
4.Assume that Tidewater uses a perpetual specific identification inventory system. Its ending inventory consists of 20 units from beginning inventory, 40 units from the June 3 purchase, and 45 units from the June 15 purchase. Determine the value of its ending inventory.
5.Assume that Tidewater uses a perpetual weighted average identification inventory system. Its ending inventory consists of 20 units. Determine the value of its ending inventory.
6. Assume that Tidewater uses a perpetual weighted average identification inventory system. Its ending inventory consists of 20 units. Determine the value of cost of goods sold for June.
June 1 Beginning inventory
75 units at $25 each
June 3 Purchase
348 units at $27 each
June 8 Sale
300 units
June 15 Purchase
257 units at $28 each
June 23 Sale
275 units
Explanation / Answer
Tidewater Merchandising Company All Amounts in $ 1. Valuation of Inventory based on FIFO - Perpetual Date Particulars Qty. Rate $ Amount $ 01-Jun Opening Inventory 75 25 1875 03-Jun Purchase 348 27 9396 08-Jun Cost of Sales -75 25 -1875 Cost of Sales -225 27 -6075 15-Jun Purchase 257 28 7196 23-Jun Cost of Sales -123 27 -3321 Cost of Sales -152 28 -4256 Closing Inventory 105 28 2940 2. Valuation of Inventory based on FIFO - Periodic Date Particulars Qty. Rate $ Amount $ 01-Jun Opening Inventory 75 25 1875 03-Jun Purchase 348 27 9396 08-Jun Cost of Sales -75 25 -1875 Cost of Sales -225 27 -6075 15-Jun Purchase 257 28 7196 23-Jun Cost of Sales -123 27 -3321 Cost of Sales -152 28 -4256 Closing Inventory 105 28 2940 3. Valuation of Inventory based on LIFO - Perpetual Date Particulars Qty. Rate $ Amount $ 01-Jun Opening Inventory 75 25 1875 03-Jun Purchase 348 27 9396 08-Jun Cost of Sales -300 27 -8100 15-Jun Purchase 257 28 7196 23-Jun Cost of Sales -257 28 -7196 Cost of Sales -18 27 -486 Closing Inventory 30 27 810 Closing Inventory 75 25 1875 4. Valuation of Inventory based on Specific Identification Method Qty. Rate $ Amount $ From Opening Inventory 20 25 500 From June 3 Purchase 40 27 1080 From June 15 Purchase 45 28 1260 Closing Inventory 105 2840 5 and 6. Valuation of Inventory and Cost of Goods Sold based on Weighted Average Identification Method Date Particulars Qty. Rate $ Amount $ 01-Jun Opening Inventory 75 25 1875 03-Jun Purchase 348 27 9396 Weighted Average 423 26.65 11271 08-Jun Cost of Sales -300 26.6 -7993.6 15-Jun Purchase 257 28 7196 Weighted Average 380 27.56 10473.4 23-Jun Cost of Sales -275 27.6 -7579.4 Closing Inventory 20 27.56 551.231 Closing Inventory is valued at $ 551.231. Cost of Goods Sold are valued at $ 15,573.04.
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