Dec. 1 Beginning merchandise inventory 13 units @ $11 each 8 Sale 7 units @ $27
ID: 385630 • Letter: D
Question
Dec. 1
Beginning merchandise inventory
13
units @
$11
each
8
Sale
7
units @
$27
each
14
Purchase
14
units @
$16
each
21
Sale
13
units @
$27
each
Assume that
Upper R Upper K ToysR K Toys
store bought and sold a line of dolls during
DecemberDecember
as follows:
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Upper R Upper K ToysR K Toys
uses the perpetual inventory system.Read the requirements.
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Requirement 1. Compute the cost of goods sold, cost of ending merchandise inventory, and gross profit using the FIFO inventory costing method.
Begin by computing the cost of goods sold and cost of ending merchandise inventory using the FIFO inventory costing method. Enter the transactions in chronological order, calculating new inventory on hand balances after each transaction. Once all of the transactions have been entered into the perpetual record, calculate the quantity and total cost of merchandise inventory purchased, sold, and on hand at the end of the period. (Enter the oldest inventory layers first.)
Purchases
Cost of Goods Sold
Inventory on Hand
Unit
Total
Unit
Total
Unit
Total
Date
Quantity
Cost
Cost
Quantity
Cost
Cost
Quantity
Cost
Cost
Dec. 1
Dec. 8
Dec. 14
Dec. 21
Totals
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6
parts remaining
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Purchases
Cost of Goods Sold
Inventory on Hand
Unit
Total
Unit
Total
Unit
Total
Date
Quantity
Cost
Cost
Quantity
Cost
Cost
Quantity
Cost
Cost
Dec. 1
Dec. 8
Dec. 14
Dec. 21
Totals
Explanation / Answer
Gross profit = Sales - Cost of goods sod
Gross profit = (20 X $27) - $255
Gross profit = $285
Cost of goods available for sale Cost of goods sold - Periodic FIFO Ending Inventory - Periodic FIFO FIFO # of units (A) Cost per unit Cost of goods available for sale # of units sold (B) Cost per unit Cost of goods sold # of units in ending inventory (A) - (B) Cost per unit Ending Inventory Dec-01 13 $ 11 $ 143 Dec-08 7 $ 11 $ 77 6 $ 11 $ 66 Dec-14 14 $ 16 $ 224 6 $ 11 $ 66 14 $ 16 $ 224 Dec-21 6 $ 11 $ 66 7 $ 16 $ 112 7 $ 16 $ 112 Totals 14 $ 224 20 $ 255 7 $ 112Related Questions
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