Title | ACCT 2301 Chapter 5 Homework |
---|---|
Author | Hope Miller |
Course | Principles Of Accounting I |
Institution | Angelo State University |
Pages | 3 |
File Size | 176.9 KB |
File Type | |
Total Downloads | 38 |
Total Views | 175 |
Homework assignment...
ACCT 2301 Chapter 5 Homework Trey Monson starts a merchandising business on December 1 and enters into the following three inventory purchases. Monson uses a periodic inventory system. Also, on December 15, Monson sells 25 units for $25 each. Purchases on December 7 15 units @ $10.00 cost Purchases on December 14 30 units @ $15.00 cost Purchases on December 21 25 units @ $17.00 cost Determine the costs assigned to the December 31 ending inventory based on FIFO method. Periodic FIFO
Cost of Goods Available for Sale # of Cost Cost of units per Goods unit Available for Sale
Cost of Goods Sold # of units sold
Cost per unit
Cost of Goods Sold
Inventory Balance # of units in ending inventory
Cost per unit
Ending Inventory
Purchase s Dec 7 15 $10.00 $150 15 10.00 150 0 Dec 14 30 15.00 450 10 15.00 150 20 15.00 300 Dec 21 25 17.00 425 0 25 17.00 425 Total 70 $1,025 25 300 45 725 Determine the costs assigned to ending inventory when costs are assigned based on the LIFO method. Periodic LIFO
Cost of Goods Available for Sale Cost of # of Cost Goods units per Available unit for Sale
Cost of Goods Sold # of units sold
Cost per unit
Cost of Goods Sold
Inventory Balance # of units in ending inventory
Cost per unit
Ending Inventory
Purchase s Dec 7 15 $10.00 $150 0 15 10.00 150 Dec 14 30 15.00 450 0 30 15.00 450 Dec 21 25 17.00 425 25 17.00 425 0 Total 70 $1,025 25 425 45 600 Determine the costs assigned to ending inventory when costs are assigned based on the weighted average method. Periodic Weighted Average
Inventory on Hand # of units
Purchase – Dec 7 Purchase – Dec 14 Purchase – Dec 21 Available for sale
Cost per unit 15 $10.00 30 15.00 25 17.00 70 14.64
Inventory Value $150 450 425 1,025
Cost of Goods Sold # of units sold
Avg. Cost per Unit
Cost of Goods Sold
December Sales (25) 14.64 (366) 25 $14.64 366 Total 45 $14.64 $659 25 $366 Monson sells 25 units for $25 each. Of the units sold, 12 are from the December 7 purchase and 13 are from the December 14 purchase. Determine the costs assigned to ending inventory when costs are assigned based on specific identification. Specific Identification
Purchases Dec 7 Dec 14 Dec 21 Total
Cost of Goods Available Cost of Goods Sold for Sale # of Cost Cost of # of Cost Cost units per Goods units per of unit Available sold unit Goods for Sale Sold 15 30 25 70
10.00 15.00 17.00
150 450 425
12 13 0 25
10.00 15.00
120 195 315
Inventory Balance # of units in ending inventory
Cost per unit
Ending Inventory
3 17 25 45
10.00 15.00 17.00
30 255 425 710
Identify the inventory costing method (SI, FIFO, LIFO, or WA) best described by each of the following separate statements. Assume a period of increasing costs. 1 2 3 4 5
Precisely matches the costs of items with the revenues they generate Mimics the actual flow of inventory for most businesses Has the lowest tax expense because of reporting the lowest net income Tends to smooth out the erratic changes in costs Results in the highest cost of goods sold
Specific Identification FIFO LIFO Weighted Average LIFO
Homestead Crafts, a distributor of handmade gifts, operates out of owner Emma Finn’s house. At the end of the current period, Emma looks over her inventory and finds that she has
1,900 units (products) in her basement, 13 of which were damaged by water and cannot be sold 160 units in her van, ready to deliver per a customer order, terms FOB destination 140 units out on consignment to a friend who owns a retail store
How many total units should Emma include in her company’s period-end inventory? Units in Ending Inventory: Units of Product on hand: Add: Units in transit Units on consignment Less: Damaged units Total units in period-end inventory
1,900 Units 160 140 13 2,187 units
A car dealer acquires a used car for $19,000, with terms FOB shipping point. Compute total inventory costs assigned to the used car if additional costs include
$120 for transportation-in $170 for shipping insurance $730 for car import duties $110 for advertising $2,000 for sales staff salaries $150 for trimming shrubs Cost
Cost Transportation-in Import Duties Insurance during shipment Advertising Sales staff salaries Trimming shrubs Total
Included in Inventory cost $19,000 19,000 120 120 730 730 170 170 110 2,000 150 $22,280
Expensed As incurred
110 2,000 150...