During the year, Wright Company sells 490 remote-control airplanes for $120 each. The company has the following inventory purchasetransactions for the year.Number ofUnits40270220UnitCost$687176Total Cost$2,72019,17016,720DateTransactionBeginning inventoryPurchaseJan. 1May. 5Nov. 3Purchase530$38,610Calculate ending inventory and cost of goods sold for the year, assuming the company uses FIFO.FIFOCost of Goods Available for SaleCost of Goods SoldEnding InventoryCost of GoodsAvailable for Sale2.720Cost of GoodsSoldEndingInventory# of units Cost per unit# of unitsCost per unit#of unitsCost per unitBeginning Inventory406840$4682.720Purchases:May 5270 $7119,1702707119.170Nov. 32207616,7202207616,720Total53038,61053038.610$4%24%24%249.%24

Introduction: FIFO: FIFO stands for First in First Out. Which means first received inventory to be…

During the year, Wright Company sells 490 remote-control airplanes for $120 each. The company has the following inventory purchase transactions for the year. Number of Unit Date Transaction Units Cost Total Cost $ 2,720 19,170 40 $ 68 Beginning inventory Purchase Jan. 1 270 71 May. 5 Nov. 3 Purchase 220 76 16,720 530 $38,610

During the year, Wright Company sells 490 remote-control airplanes for $120 each. The company has the following inventory purchase transactions for the year. Number of Unit Date Transaction Units Cost Total Cost $ 2,720 19,170 40 $ 68 Beginning inventory Purchase Jan. 1 270 71 May. 5 Nov. 3 Purchase 220 76 16,720 530 $38,610

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter7: Inventories: Cost Measurement And Flow Assumptions

Section: Chapter Questions

Problem 8P: Comprehensive The following information for 2019 is available for Marino Company: 1. The beginning...

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Inventory Costing Methods On June 1, Welding Products Company had a beginning inventory of 210 cases of welding rods that had been purchased for S88 per case. Welding Products purchased 1,150 cases at a cost of $95 per case on June 3. On June 19, the company purchased another 950 cases at a cost of $112 per case. Sales data for the welding rods are: Welding Products uses a perpetual inventory system, and the sales price of the welding rods was $130 per case. Required: 1. Compute the cost of ending inventory and cost of goods sold using the FIFO method. 2. Compute the cost of ending inventory and cost of goods sold using the LIFO method. 3. Compute the cost of ending inventory and cost of goods sold using the average cost method. ( Note: Use four decimal places for per-unit calculations and round all other numbers to the nearest dollar.) 4. CONCEPTUAL CONNECTION Assume that operating expenses are $21,600 and Welding Products has a 30% tax rate. How much will the cash paid for income taxes differ among the three inventory methods? 5. CONCEPTUAL CONNECTION Compute Welding Products' gross profit ratio (rounded to two decimal places) and inventory turnover ratio (rounded to three decimal places) under each of the three inventory costing methods. How would the choice of inventory costing method affect these ratios?
Inventory Costing and LCM Ortman Enterprises sells a chemical used in various manufacturing processes. On January 1, 2019, Ortman had 5,000,000 gallons on hand, for which it had paid $0.50 per gallon. During 2019, Ortman made the following purchases: During 2019, Ortman sold 65 000,000 gallons at $0.75 per gallon (35,000,000 gallons were sold on June 29 and 30,000,000 gallons were sold on Nov. 22), leaving an ending inventory of 7,000,000 gallons. Assume that Ortman uses a perpetual inventory system. Ortman uses the lower of cost or market for its inventories, as required by generally accepted accounting principles. Required: 1. Assume that the market value of the chemical is $0.76 per gallon on December 31, 2019. Compute the cost of ending inventory using the FIFO and average cost methods, and then apply LCM. ( Note: Use four decimal places for per-unit calculations and round all other numbers to the nearest dollar.) 2. Assume that the market value of the chemical is $0.58 per gallon on December 31, 2019. Compute the cost of ending inventory using the FIFO and average cost methods, and then apply LCM. ( Note: Use four decimal places for per-unit calculations and round all other numbers to the nearest dollar.)
Shaquille Corporation began the current year with inventory of 50,000. During the year, its purchases totaled 110,000. Shaquille paid freight charges of 8,500 for those purchases. At the end of the year, Shaquille had inventory of 47,800. Prepare a schedule to determine Shaquille's cost of goods sold for the current year.
On January 1 of Year 1, Dorso Company adopted the dollar-value LIFO method of inventory costing. Dorsos December 31 ending inventory records are as follows: Year 1: Current cost, 20,000; Index, 100 Year 2: Current cost, 33,600; Index, 120 Using the dollar-value LIFO method, compute Dorsos December 31 ending inventory for Year 2.
Webster Company adopted do liar-value LIFO on January 1, 2019. Webster produces three products: X, Y, and Z. Websters beginning inventory consisted of the following: During 2019, Webster had the following purchases and sales: Required: 1. Compute the LIFO cost of the ending inventory assuming Webster uses a single inventory pool. Round cost index to 4 decimal places. 2. Compute the LIFO cost of the ending inventory assuming Webster uses three inventory pools. Round cost indexes to 4 decimal places.
Comprehensive The following information for 2019 is available for Marino Company: 1. The beginning inventory is 100,000. 2. Purchases returns of 4,000 were made. 3. Purchases of 300,000 were made on terms of 2/10, n/30. Eighty percent of the discounts were taken. 4. At December 31, purchases of 20,000 were in transit, FOB destination, on terms of 2/10, n/30. 5. The company made sales of 640,000. The gross selling price per unit is twice the net cost of each unit sold. 6. Sales allowances of 6,000 were made. 7. The company uses the LIFO periodic method and the gross method for purchase discounts. Required: 1. Compute the cost of the ending inventory before the physical inventory is taken. 2. Compute the amount of the cost of goods sold that came from the purchases of the period and the amount that came from the beginning inventory.
Hurst Companys beginning inventory and purchases during the fiscal year ended December 31, 20-2, were as follows: There are 1,200 units of inventory on hand on December 31, 20-2. REQUIRED 1. Calculate the total amount to be assigned to the cost of goods sold for 20-2 and ending inventory on December 31 under each of the following periodic inventory methods: (a) FIFO (b) LIFO (c) Weighted-average (round calculations to two decimal places) 2. Assume that the market price per unit (cost to replace) of Hursts inventory on December 31 was 18. Calculate the total amount to be assigned to the ending inventory on December 31 under each of the following methods: (a) FIFO lower-of-cost-or-market (b) Weighted-average lower-of-cost-or-market 3. In addition to taking a physical inventory on December 31, Hurst decides to estimate the ending inventory and cost of goods sold. During the fiscal year ended December 31, 20-2, net sales of 100,000 were made at a normal gross profit rate of 35%. Use the gross profit method to estimate the cost of goods sold for the fiscal year ended December 31 and the inventory on December 31.
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During the year, Wright Company sells 330 remote-control airplanes for $110 each. The company has the following inventory purchase transactions for the year. DateTransactionNumber of UnitsUnit CostTotal CostJan. 1Beginning inventory 60 $73 $4,380 May. 5Purchase 205 76 15,580 Nov. 3Purchase 110 81 8,910 375 $28,870 Calculate ending inventory and cost of goods sold for the year, assuming the company uses LIFO.
During the year, Wright Company sells 425 remote-control airplanes for $110 each. The company has the following inventory purchase transactions for the year. Number Date Transaction of Units Unit Cost Total Cost $ 4,740 19,270 14,790 Jan. 1 $79 Beginning inventory Purchase 60 Мay 5 Nov. 3 235 82 Purchase 170 87 465 $ 38,800 Calculate ending inventory and cost of goods sold for the year, assuming the company uses LIFO. LIFO Cost of Goods Available for Sale Cost of Goods Sold Ending Inventory Cost of Average # of units Cost per Average # of units Cost per unit Cost of Goods Average Cost Goods Ending Inventory # of units Available unit for Sale Sold per unit Beginning Inventory $ $ $ Purchases: May 5 $ Nov. 3 $ Total
During the year, Wright Company sells 510 remote-control airplanes for $100 each. The company has the following inventory purchase transactions for the year. Number of Unit Total Date January 1 Transaction, Beginning inventory Units Cost Cost 50 $64 $3,200 May 5 Purchase 290 67 19,430 240 580 72 17,280 $39,910 November 3 Purchase Calculate ending inventory and cost of goods sold for the year, assuming the company uses FIFO. Cost of Goods Available for Sale Number Cost per FIFO Cost of Goods Number of units unit Available for Sale of units Cost of Goods Sold Cost per unit Cost of Goods Number Sold of units Ending Inventory Cost per unit Ending Inventory Beginning Inventory 50 $ 64 $ 3,200 $ 이 Purchases May 5 290 67 19,430 0 November 3 240 72 17.280 0 Total 580 $ 39,910 ° $ о $ 0
During the year, Wright Company sells 455 remote-control airplanes for $110 each. The company has the following inventory purchase transactions for the year. Number of Unit Date January 1 May 5 Transaction Units Cost Total Cost Beginning inventory Purchase 60 $79 $4,740 235 82 19,270 November 3 Purchase 185 87 16,095 480 $40,105 Calculate ending inventory and cost of goods sold for the year, assuming the company uses FIFO Cost of Goods Available for Sale Ending Inventory Cost of Goods Sold FIFO Number Cost per Cost of Goods Number of units unit Available for Sale of units Cost per unit Cost of Goods Sold Number of units Ending Inventory Cost per unit Beginning Inventory 60 $ 79 $ 4,740 $ 0 Purchases: May 5 235 82 19,270 0 November 3 185 87 16,095 0 Total 480 $ 40,105 $ 0 0 $