Periodic Inventory by Three Methods Dymac Appliances uses the periodic inventory
ID: 2542497 • Letter: P
Question
Periodic Inventory by Three Methods
Dymac Appliances uses the periodic inventory system. Details regarding the inventory of appliances at January 1, purchases invoices during the next 12 months, and the inventory count at December 31 are summarized as follows:
Required:
1. Determine the cost of the inventory on December 31 by the first-in, first-out method.
If the inventory of a particular model comprises one entire purchase plus a portion of another purchase acquired at a different unit cost, use a separate line for each purchase. If units are in inventory at two different costs, enter the units PURCHASED MOST RECENTLY first.
2. Determine the cost of the inventory on December 31 by the last-in, first-out method.
If the inventory of a particular model comprises one entire purchase plus a portion of another purchase acquired at a different unit cost, use a separate line for each purchase. If units are in inventory at two different costs, enter the OLDEST units first.
3. Determine the cost of the inventory on December 31 by the weighted average cost method.
4. would be preferred for income tax purposes in periods of rising prices.
Purchases InvoicesModel Inventory,
January 1
1st
2nd
3rd Inventory Count,
December 31 A10 __ 4 at $ 64 4 at $ 70 4 at $ 76 6 B15 8 at $ 176 4 at 158 3 at 170 6 at 184 8 E60 3 at 75 3 at 65 15 at 68 9 at 70 5 G83 7 at 242 6 at 250 5 at 260 10 at 259 9 J34 12 at 240 10 at 246 16 at 267 16 at 270 15 M90 2 at 108 2 at 110 3 at 128 3 at 130 5 Q70 5 at 160 4 at 170 4 at 175 7 at 180 8
Explanation / Answer
1. Ending inventory under FIFO
2. Ending inventory under LIFO
3. Ending inventory under weighted average
4. FIFO inventroy method should be followed because increase in ending inventroy will decrease in profit o that tax will also be decreases
Model Quantity Unit cost Total cost A10 4 76 304 A10 2 70 140 B15 6 184 1104 B15 2 170 340 E60 5 70 350 G83 9 259 2331 J34 15 270 4050 M90 3 130 390 M90 2 128 256 Q70 7 180 1260 Q70 1 175 175 Total 56 11144Related Questions
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