1. The following information was available from the inventory records of Swifty
ID: 2510170 • Letter: 1
Question
1. The following information was available from the inventory records of Swifty Corporation for January:
Units
Unit Cost
Total Cost
Balance at January 1
9000
$9.10
$81900
Purchases:
January 6
6000
10.30
61800
January 26
7000
10.70
74900
Sales
January 7
(6000
)
January 31
(12000
)
Balance at January 31
4000
Assuming that Swifty maintains perpetual inventory records, what should be the cost of goods sold at January 31, using the moving-average inventory method, rounded to the nearest dollar?
A. $189,836
B. $178,320
C. $159,744
D. $40,280
2. Transactions for the month of June were:
Purchases
Sales
June 1
(balance) 3150 @
$3.30
June 2
2480
3
8730 @
3.20
6
6390
7
4820 @
3.40
9
4000
15
7130 @
3.50
10
1520
22
2080 @
3.60
18
5590
25
830
Assuming that perpetual inventory records are kept in dollars, the COGS on a LIFO basis is
A. $69,813
B. $68,058
C. $67,349
D. $67,251
3. Sheffield Corp. adopted the dollar-value LIFO method of inventory valuation on December 31, 2016. Its inventory at that date was $1,120,000 and the relevant price index was 100. Information regarding inventory for subsequent years is as follows:
Date
Inventory at
Current Prices
Current
Price Index
December 31, 2017
$1,293,630
107
December 31, 2018
1,413,350
115
December 31, 2019
1,590,000
125
What is the cost of the ending inventory at December 31, 2019 under dollar-value LIFO?
A. $1,209,000
B. $1,293,630
C. $1,198,400
D. $1,291,980
Units
Unit Cost
Total Cost
Balance at January 1
9000
$9.10
$81900
Purchases:
January 6
6000
10.30
61800
January 26
7000
10.70
74900
Sales
January 7
(6000
)
January 31
(12000
)
Balance at January 31
4000
Explanation / Answer
1.
The correct answer is (b), COGS = 178320
Date Description Units Rate Amount Unit Rate Amount Balance Units Rate Amount Jan, 01 Opening 0 0 0 0 0 0 9000 9.1 81900 Jan, 06 Purchase 6000 10.3 61800 0 0 0 15000 9.58 143700 Jan, 07 Sales 0 0 0 6000 9.58 57480 9000 9.58 86220 Jan, 26 Purchase 7000 10.7 74900 0 0 0 16000 10.07 161120 Jan, 31 Sales 0 0 0 12000 10.07 120840 4000 10.07 40280 Total 13000 136700 18000 178320Related Questions
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