Greg’s Bicycle Shop has the following transactions related to its top-selling Mo
ID: 2547209 • Letter: G
Question
Greg’s Bicycle Shop has the following transactions related to its top-selling Mongoose mountain bike for the month of March. Greg's Bicycle Shop uses a periodic inventory system.
Calculate ending inventory and cost of goods sold at March 31, using the specific identification method. The March 5 sale consists of bikes from beginning inventory, the March 17 sale consists of bikes from the March 9 purchase, and the March 27 sale consists of four bikes from beginning inventory and eight bikes from the March 22 purchase.
Date Transactions Units Cost perUnit Total Cost March 1 Beginning inventory 20 $250 $ 5,000 March 5 Sale ($400 each) 15 March 9 Purchase 10 270 2,700 March 17 Sale ($450 each) 8 March 22 Purchase 10 280 2,800 March 27 Sale ($475 each) 12 March 30 Purchase 9 300 2,700 $ 13,200
Explanation / Answer
STATEMENT SHOWING CLOSING INVENTORY AND COST OF GOOD SOLD
( UNDER THE SPEIFIC IDENTIFICATION METHOD)
STEP 1: COMPUTATION OF CLOSING STOCK:
DATE PURCAHSE SALE CLOSING STOCK
QTY PRICE VALUE QTY PRICE VALUE QTY PRICE VALUE
BEGINING INVENTORY 20 $250 $5000
MARCH 5 15 $400 $ 6000 5 $250 $1250
MARCH 9 10 $270 $2700 5 $250 $1250
10 $270 $2700
MARCH 17 8 $450 $3600 5 $250 $1250
2 $ 270 $540
MARCH 22 10 $280 $2800 5 $ 250 $1250
2 $ 270 $ 540
10 $ 280 $2800
MARCH 27 12 $475 $ 5700 1 $250 $250 2 $270 $540 2 $ 280 $560
MARCH 30 9 $300 $2700 1 $ 250 $250 2 $ 270 $540 2 $280 $560 9 $ 300 $2700
VALUE OF CLOSING STOCK:
1 $ 250 $250 2 $ 270 $540 2 $280 $560 9 $ 300 $2700
TOTAL VALUE 14 $ 4050
STEP 2: COMPUTATION OF COST OF GOODS SOLD:
DATE SOLD UNITS COST PER UNIT($) VALUE($)
MARCH 5 15 250 1250
MARCH 17 8 270 2160
MARCH 27 8 280 2240 4 250 1000
COST OF GOODS SOLD 6680
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.