eBook Calculator Instructions Inventory Valuation Journal Entries Instructions L

Question

eBook Calculator Instructions Inventory Valuation Journal Entries Instructions Lower-of-Cost-or-Market For the weighted-average method, round calculations to two decimal places. If required, round your final answers to the nearest cent. 1. Calculate the total amount to be assigned to the ending inventory under each of the following periodic inventory methods. 2. Assume that the market price per unit (cost to replace) of Stalberg's inventory on December 31, 20--, was $26. Calculate the total amount to be assigned to the ending inventory on December 31 under each of the following methods. 3. What journal entry would be made under lower-of-cost-or-market for parts 2(a) FIFO and 2(b) Weighted-average? If no entry is required, pe "No entry required" in the account name box and leave the amount boxes blank or enter "O ) Stalberg Company's beginning inventory and purchases during the fiscal year ended December 31, 20-, were as follows: Unit Price Units 10 10 Total Cost Jan. 1 Beginning inventory $18 $180 Mar. 5 1st purchase 220

Explanation / Answer

STATEMENT SHOWING INVENTORY RECORD UNDER PERIODIC FIFO METHOD RECIEPTS COST OF GOODS SOLD BALANCE DATE UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ Jan1 balance 10 18 180 10 18 180 Purchasse 5-Mar 10 22 220 10 22 220 9-Sep 10 25 250 10 25 250 8-Dec 10 30 300 10 30 300 TOTAL 40 950 30 650 10 300 STATEMENT SHOWING INVENTORY RECORD UNDER PERIODIC WEIGHTED AVERAGE METHOD RECIEPTS COST OF GOODS SOLD BALANCE DATE UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ DATE UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ Jan1 balance 10 18 180 Purchasse 5-Mar 10 22 220 9-Sep 10 25 250 8-Dec 10 30 300 TOTAL 40 23.75 950 30 23.75 712.5 10 23.75 237.5 Req 1: Ending inventory: FIFO: $ 300 Average: $ 237.50 Req 2. Market price: $ 260 Amount assigned to ending inventory: FIFO: $260 Average : $ 237.50 Req 3: Loss on reduction to NRV Dr. 40       Merchandise Inventory (300-260) 40 (for reduction of inventory Under FIFO) NO entry under Average

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