2 Calculate ending inventory using the lower of cost and net realizable value.
Q: Required: 1. Using FIFO, calculate ending inventory, cost of goods sold, sales revenue, and gross…
A: Inventory: Inventory refers to the raw materials, work-in process, and the finished goods…
Q: Using the lower of cost or market, what should the total inventory value be for the following items:…
A:
Q: Calculate ending inventory under FIFO and LIFO both with workings
A: Formula: Ending inventory = Beginning inventory + Purchases - sales units
Q: a. What is the total cost of the ending inventory according to FIFO? b. What is the total cost of…
A: Ending inventory is computed by adding the beginning inventory and purchases and then subtracting…
Q: Lower-of-Cost-or-Market Method On the basis of the following data, determine the value of the…
A: Using LCM method, the inventory is valued at lower of the value between market value and cost value.…
Q: Essay question Explain the application of AVERAGE cost flow assumption in determining .cost of goods…
A: Average cost flow assumption is a calculation companies use to assign costs to inventory goods, cost…
Q: Describe how to find inventory value using the average cost method.
A: Inventory: It is a list of goods or stock of goods which is held for doing a business. It includes…
Q: Using Average - perpetual, how much is the cost of ending inventory per unit? Using Average -…
A: Under average cost method of inventory, average cost per unit of inventory is used for calculation…
Q: If costs are declining, will the LIFO or FIFO method of inventory valuation yield the lower cost of…
A: Inventory cost flow assumptions: These are the methods used by the companies to compute the cost…
Q: 1. Inventory should be stated at (a) Lower of cost and fair value. (b) Lower of cost and net…
A: Inventory means the stock of goods in which the businessmen deals. Inventory is to be valued as per…
Q: The cost method that will yield an ending inventory value that is somewhere between possible high…
A: Inventory valuation has 4 Methods - 1. FIFO 2. LIFO 3. Weighted Average 4. Specific Identification…
Q: FIFO method find Cost of goods sold and Ending inventory values.
A: Formula: FIFO : FIFO stands for First in First out. Which means first received inventory to be sold…
Q: What is the cost of ending inventory
A: Retail inventory method refers to an accounting method which is used by the companies to compute the…
Q: Required: Compute the ending inventory cost using a. Moving average method b. FIFO method
A: The inventory can be valued using various method as LIFO, FIFO and average method.
Q: How do calculate the Cost of Goods Sold without the beginning inventory nor the ending inventory??
A: Cost of goods sold is the total costs incurred on those units of goods or products which are sold by…
Q: I need number 3. Determine the cost assigned to ending inventory and to cost of goods sold using…
A: In this Numerical has Covered the Concept Inventory Valuation Through FIFO method. 1.FIFO:- As The…
Q: Which of the following is the same as 'net realisable value' of inventory? a. proceeds of sale…
A: The question is multiple choice question Required Choose the Correct Option.
Q: 2. When Inventory is sold, how is the cost of goods sold account affected? Briefly explain
A: Inventory is an asset which is recorded in the balance sheet . It is the merchandise owned by the…
Q: (b) Will the results in (a) be higher or lower than the results under FIFO and LIFO? Ending…
A: Ending inventory is 100 units at the end of June. So the cost of ending inventory as per following…
Q: 2- Which of the following is a product cost as it relates to inventory? a. Selling costs. b.…
A: Hi student Since there are multiple questions, we will answer only first question.
Q: Compute the cost of the ending inventory and the cost of goods sold under FIFÓ, LIFÓ, and…
A:
Q: How do you use FIFO and LIFO to calculate the cost of inventory?
A: Lets understand the meaning of LIFO and FIFO method. In First In First Out (FIFO) method company…
Q: Explain an example how to calculate net cost of inventory.
A: Net Cost of Inventory indicates the actual cost of inventory purchased. Net cost of inventory is…
Q: I need number 2. Determine the costs assigned to ending inventory and to cost of goods sold using…
A: Step 1 Inventory management system is the process of managing the flow of inventory
Q: Using the lower of cost or market, what should the total inventory value be for the following items:…
A: Value of inventory = Lower of Total cost price and Total market price
Q: der the method, ending inventory is based on the costs of the most recent purchases. A. FIFO B.…
A: The question is multiple choice question. Required Choose the Correct Option.
Q: Question One : define inventory costing methods and compare between them in term of cost of goods…
A: Note: Hi! Thank you for the question As per the honor code, We’ll answer the first question since…
Q: Required: Compute the cost of the ending inventory and the cost of goods sold under FIFO Method.
A: Given: Opening Inventory 200 units @ $5 Purchase 300 Units @ $6…
Q: If merchandise inventory is being valued at cost and the price level is decreasing, which of the…
A: Inventory cost is calculated by LIFO, FIFO and average cost method. Under LIFO method, inventory…
Q: Based on the fundamental principle of IAS2, identify two (2) circumstances where the NRV of…
A: The NRV of the inventories is estimated in the usual course of the business and costs related to…
Q: Calculate the value of ending inventory and cost of goods sold
A: value of Inventory can be found out using 3 methods FIFO LIFO Weighted Average
Q: (2). For valuation of inventory, the lower of cost or market rule may be applied to (a). the total…
A: Inventory is the amount or value of all goods that the business owns. It includes all raw materials,…
Q: inventory is added to Total Goods Available for Sale when computing for Cost of Goods Sold. True F
A: Solution: False. The statement that Ending inventory is added to Total Goods Available for Sale when…
Q: How do i calculate ending inventory and cost of goods sold using LIFO?
A: LIFO stands for last-in-first-out, in this method, goods which are produced at last are assumed to…
Q: Identify the inventory costing method (SI, FIFO, LIFO, or WA) best described by each of the…
A: The relevant inventory valuation methods are listed as per the given information.
Q: 1. Which one of the following types of costs is most likely to be included in determining the cost…
A: Answer to the first question: The type of cost that is directly related to the cost of inventory is…
Q: nding Inventory and Cost of goods sold using LIFO?
A:
Q: Compute cost of goods sold and gross profit using the FIFO inventory costing method and using the…
A: The inventory can be valued using various methods as LIFO, FIFO and weighted average method of…
Q: Using LIFO method, determine cost of goods sold (COGS) and ending inventory (S).
A: C) Calculation of Cost of goods sold & ending inventory using LIFO: 127 units sold on April 15…
Q: Instructions: 1. Compute the estimated cost of ending inventory using the conservative approach 2.…
A: Particulars Cost Retail Beginning inventory 650,000 1,200,000 Add: Net Purchases (Purchase -…
Q: 1. Complete the table to determine the cost assigned to ending inventory and cost of goods sold…
A: 1) Determination of cost of goods sold & ending inventory under specific identification method:…
Q: Calculate the value of ding system. Ending inventory Cost of goods sold $ $
A: FIFO It is the method where we assume that the goods which were purchased earlier will be sold…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- LIFO and Inventory Pools On January 1, 2016, Grover Company changed its inventory cost flow method to the LIFO cost method from the FIFO cost method for its raw materials inventory. It made the change for both financial statement and income tax reporting purposes. Grover uses the multiple-pools approach under which it groups substantially identical raw materials into LIFO inventory pools. It uses weighted average costs in valuing annual incremental layers. The composition of the December 31, 2018, inventory for the Class F inventory pool is as follows: Inventory transactions for the Class F inventory pool during 2019 were as follows: On March 2, 2019, 4,800 units were purchased at a unit cost of 13.50 for 64,800. On September 1, 2019, 7,200 units were purchased at a unit cost of 14.00 for 100,800. A total of 15,000 units were used for production during 2019. The following transactions for the Class F inventory pool took place during 2020: On January 11, 2020, 7,500 units were purchased at a unit cost of 14.50 for 108,750. On May 14, 2020, 5,500 units were purchased at a unit cost of 15.50 for 85,250. On December 29, 2020, 7,000 units were purchased at a unit cost of 16.00 for 112,000. A total of 16,000 units were used for production during 2020. Required: 1. Prepare a schedule to compute the inventory (units and dollar amounts) of the Class F inventory pool at December 31, 2019. Show supporting computations in good form. 2. Prepare a schedule to compute the cost of Class F raw materials used in production for the year ended December 31, 2019. 3. Prepare a schedule to compute the inventory (units and dollar amounts) of the Class F inventory pool at December 31, 2020. Show supporting computations in good form.Inventory Write-Down Stiles Corporation uses the FIFO cost flow assumption and is in the process of applying the LCNRV rule for each of two products in its ending inventory. A profit margin of 30% on the selling price is considered normal for each product. Specific data for each product are as follows: Inventory Write-Down Use the information in E8-1. Assume that Stiles uses the LIFO cost flow assumption and is applying the LCM rule. Required: 1. What is the correct inventory value for each product? 2. Next Level With regard to requirement 1, what effect does the imposition of the constraints on market value have on the inventory valuations?Lower-of-cost-or market inventory Data on the physical inventory of Moyer Company as of December 31, 20Y9, are presented below. Quantity and cost data from the last purchases invoice of the year and the next-to-the-last purchases invoice are summarized as follows: Instructions Determine the inventory at cost and at the lower of cost or market, using the first-in, first-out method. Record the appropriate unit costs on an inventory sheet and complete the pricing of the inventory. When there are two different unit costs applicable to an item, proceed as follows: 1. Draw a line through the quantity, and insert the quantity and unit cost of the last purchase. 2. On the following line, insert the quantity and unit cost of the next-to-the-last purchase. 3. Total the cost and market columns and insert the lower of the two totals in the LCM column. The first item on the inventory sheet has been completed below as an example.
- Refer to the information provided in RE8-4. If Paul Corporations inventory at January 1, 2019, had a cost and net realizable value of 300,000, prepare the journal entry to record the reductions to NRV for Paul Corporation assuming that Paul uses a periodic inventory system and the direct method. Paul Corporation uses FIFO and reports the following inventory information: Assuming Paul uses a perpetual inventory system and the direct method, prepare the journal entry to record the write-down of inventory.Inventory analysis Costco Wholesale Corporation (COST) and Wal-Mart Stores Inc. (WMT) compete against each other in general merchandise retailing, gas stations, pharmacies, and optical centers. Below is selected financial information for both companies from a recent year's financial statements (in millions): a. Determine for bom companies (1) the inventory turnover and (2) the days' sales in inventory. Round to one decimal place. b. Compare and interpret the inventory metrics computed in (a).Inventory Costing Methods Crandall Distributors uses a perpetual inventory system and has the following data available for inventory, purchases, and sales for a recent year. Required: 1. Compute the cost of ending inventory and the cost of goods sold using the specific identification method. Assume the ending inventory is made up of 40 units from beginning inventory, 30 units from Purchase 1, 80 units from Purchase 2, and 40 units from Purchase 3. 2. Compute the cost of ending inventory and cost of goods sold using the FIFO inventory costing method. 3. Compute the cost of ending inventory and cost of goods sold using the LIFO inventory costing method. 4. Compute the cost of ending inventory and cost of goods sold using the average cost inventory costing method. ( Note: Use four decimal places for per-unit calculations and round all other numbers to the nearest dollar.) 5. CONCEPTUAL CONNECTION Compare the ending inventory and cost of goods sold computed under all four methods. What can you conclude about the effects of the inventory costing methods on the balance sheet and the income statement?
- 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.Inventory Write-Down The following information is taken from Aden Companys records: Required: 1. What is the correct inventory value if the company applies the LCNRV rule to each of the following? a. individual items b. groups of items c. the inventory as a whole 2. Next Level Are there any conditions under which a company may ignore the decline in the value of inventory below its cost?Refer to the information provided in RE8-4. If Paul Corporations inventory at January 1, 2019, had a cost and net realizable value of 300,000, prepare the journal entry to record the reductions to NRV for Paul Corporation assuming that Paul uses a periodic inventory system and the allowance method. Paul Corporation uses FIFO and reports the following inventory information: Assuming Paul uses a perpetual inventory system and the direct method, prepare the journal entry to record the write-down of inventory.
- Refer to the information for Morgan Inc. above. If Morgan uses a perpetual inventory system, what is the cost of ending inventory under FIFO at April 30? a. $32,500 b. $38,400 c. $63,600 d. $69,500Inventory by three cost flow methods Details regarding the inventory of appliances on January 1, 20Y7, purchases invoices during the year, and the inventory count on December 31. 2O’7. of Amsterdam Appliances are summarized as follows: Instructions Discuss which method (FIFO or LIFO) would be preferred for income tax purposes in periods of (a) rising prices and (b) declining prices.Dollar-Value LIFO Kwestel Company adopted the dollar-value LIFO method for inventory valuation at the beginning of 2015. The following information about the inventory at the end of each year is available from Kwestels records: Required: Calculate the dollar-value LIFO inventory at the end of each year. Round to the nearest dollar.