Problem 11-17 (IAA) Jailbird Company provided the following data about the inventory for the month of January: Units Unit cost Total cost Jan. 1 Beginning 5 Purchase 10 Sale 15 Purchase 16 Purchase return 25 Sale 26 Sale return 31 Purchase 16,000 4,000 15,000 20,000 1,000 8,000 4,000 30,000 2,240,000 600,000 140 150 160 3,200,000 160,000 160 150 4,500,000 What is the moving average cost of the inventory on January 31? a. 7,625,000 b. 7,500,000 c. 7,690,000 d. 7,530,000

Problem 11-17 (IAA) Jailbird Company provided the following data about the inventory for the month of January: Units Unit cost Total cost Jan. 1 Beginning 5 Purchase 10 Sale 15 Purchase 16 Purchase return 25 Sale 26 Sale return 31 Purchase 16,000 4,000 15,000 20,000 1,000 8,000 4,000 30,000 2,240,000 600,000 140 150 160 3,200,000 160,000 160 150 4,500,000 What is the moving average cost of the inventory on January 31? a. 7,625,000 b. 7,500,000 c. 7,690,000 d. 7,530,000

Quickbooks Online Accounting

3rd Edition

ISBN:9780357391693

Author:Owen

Publisher:Owen

Chapter4: Operating Activities: Sales And Cash Receipts

Section: Chapter Questions

Problem 1.3C

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Periodic inventory by three methods Pappas Appliances uses the periodic inventory system. Details regarding the inventory of appliances at January 1, purchases invoices during the year, and the inventory count at December 31 are summarized as follows: Instructions 1. Determine the cost of the inventory on December 31 by the first-in, first-out method. Present data in columnar form, using the following headings: Model Quantity Unit Cost Total Cost If the inventory of a particular model comprises one entire purchase plus a portion of another purchase acquired at a different unit cost, use a separate line for each purchase. 2. Determine the cost of the inventory on December 31 by the last-in, first-out method, following the procedures indicated in (1). 3. Determine the cost of the inventory on December 31 by the weighted average cost method, using the columnar headings indicated in (1). 4. Discuss which method (FIFO or LIFO) would be preferred for income tax purposes in periods of (a) rising prices and (b) declining prices.
Communication Golden Eagle Company began operations on April 1 by selling a single product. Data on purchases and sales for the year are as follows: Purchases: Date Units Purchased Unit Cost Total Cost April 6 31,000 36.60 1,134,600 May 18 33,000 39.00 1,287,000 June 6 40,000 39.60 1,584,000 July 10 40,000 42.00 1,680,000 August 10 27,200 42.75 1,162,800 October 25 12,800 43.50 556,800 November 4 8,000 44.85 358,800 December 10 8,000 48.00 384,000 200,000 8,148,000 Sales: April 16,000 units May 16,000 June 20,000 July 24,000 August 28,000 September 28,000 October 18,000 November 10,000 December 8,000 Total Units 168,000 Total sales 10,000,000 The president of the company, Connie Kilmer, has asked for your advice on which inventory cost flow method should be used for the 32,000-unit physical inventory that was taken on December 31. The company plans to expand its product line in the future and uses the periodic inventory system. Write a brief memo to Ms. Kilmer comparing and contrasting the LIFO and FIFO inventory cost flow methods and their potential impacts on the companys financial statements.
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