Required information [The following information applies to the questions displayed below.] Hemming Co. reported the following current-year purchases and sales for its only product Activities Units Acquired at Cost 200 units Units Sold at Retail Date Jan. 1 Beginning inventory Jan. 10 Sales @ $10 =2,000 150 units @$40 Mar. 14 Purchase 350 units $15 5,250 Mar. 15 Sales 300 units @$40 July 30 Purchase Oct. 5 Sales 450 units @$20 9,000 430 units @$40 Oct. 26 Purchase 100 units $25 2,500 $18,750 880 units Totals 1,100 units Required: Hemming uses a periodic inventory system. (a) Determine the costs assigned to ending inventory and to cost of goods sold using FIFO. (b) Determine the costs assigned to ending inventory and to cost of goods sold using LIFO. (c) Compute the gross margin for each method. a) Periodic FIFO Cost of Goods Available for Sale Cost of Goods Sold Ending Inventory Cost of Goods#of units #of units Cost per unit Cost per Ending Goods Sold inventory per unit Inventory Cost of Cost #of units Available for unit sold Sale Beginning inventory Purchases: 200 10.00 $ 200 10.00 2,000 2,000 0 $ 15.00 15.00 March 14 350 5,250 350 5,250 0 $ 20.00 9,000 July 30 450 20.00 330 6,600 120 $20.00 2,400 25.00 October 26 100 $25.00 2,500 2,500 0 100 Total 880 220 1,100 18,750 $ 13,850 $ 4,900 b) Periodic LIFO Cost of Goods Available for Sale Cost of Goods Sold Ending Inventory Cost of Goods#of units #of units Cost per Ending Goods Sold inventory per unit Inventory Cost per unit Cost of Cost of units Available for Sale unit sold Beginning inventory Purchases: 200 $ 10.00 2,000 $ 350 450 $ 15.00 March 14 5,250 $ 20.00 9,000 July 30 20.00 450 9,000 100 25.00 100 $ October 26 25.00 2,500 2,500 Total 1,100 $ 18,750 550 11,500 c) Gross Margin FIFO LIFO Sales 35,200 35,200 Cost of goods sold 13,850 16,450 21,350$ Gross margin 18,750 e 6е
Required information [The following information applies to the questions displayed below.] Hemming Co. reported the following current-year purchases and sales for its only product Activities Units Acquired at Cost 200 units Units Sold at Retail Date Jan. 1 Beginning inventory Jan. 10 Sales @ $10 =2,000 150 units @$40 Mar. 14 Purchase 350 units $15 5,250 Mar. 15 Sales 300 units @$40 July 30 Purchase Oct. 5 Sales 450 units @$20 9,000 430 units @$40 Oct. 26 Purchase 100 units $25 2,500 $18,750 880 units Totals 1,100 units Required: Hemming uses a periodic inventory system. (a) Determine the costs assigned to ending inventory and to cost of goods sold using FIFO. (b) Determine the costs assigned to ending inventory and to cost of goods sold using LIFO. (c) Compute the gross margin for each method. a) Periodic FIFO Cost of Goods Available for Sale Cost of Goods Sold Ending Inventory Cost of Goods#of units #of units Cost per unit Cost per Ending Goods Sold inventory per unit Inventory Cost of Cost #of units Available for unit sold Sale Beginning inventory Purchases: 200 10.00 $ 200 10.00 2,000 2,000 0 $ 15.00 15.00 March 14 350 5,250 350 5,250 0 $ 20.00 9,000 July 30 450 20.00 330 6,600 120 $20.00 2,400 25.00 October 26 100 $25.00 2,500 2,500 0 100 Total 880 220 1,100 18,750 $ 13,850 $ 4,900 b) Periodic LIFO Cost of Goods Available for Sale Cost of Goods Sold Ending Inventory Cost of Goods#of units #of units Cost per Ending Goods Sold inventory per unit Inventory Cost per unit Cost of Cost of units Available for Sale unit sold Beginning inventory Purchases: 200 $ 10.00 2,000 $ 350 450 $ 15.00 March 14 5,250 $ 20.00 9,000 July 30 20.00 450 9,000 100 25.00 100 $ October 26 25.00 2,500 2,500 Total 1,100 $ 18,750 550 11,500 c) Gross Margin FIFO LIFO Sales 35,200 35,200 Cost of goods sold 13,850 16,450 21,350$ Gross margin 18,750 e 6е
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter6: Cost Of Goods Sold And Inventory
Section: Chapter Questions
Problem 33BE
Related questions
Question
![Required information
[The following information applies to the questions displayed below.]
Hemming Co. reported the following current-year purchases and sales for its only product
Activities
Units Acquired at Cost
200 units
Units Sold at Retail
Date
Jan. 1 Beginning inventory
Jan. 10 Sales
@ $10
=2,000
150 units
@$40
Mar. 14 Purchase
350 units
$15
5,250
Mar. 15 Sales
300 units
@$40
July 30 Purchase
Oct. 5 Sales
450 units
@$20
9,000
430 units
@$40
Oct. 26 Purchase
100 units
$25
2,500
$18,750
880 units
Totals
1,100 units
Required:
Hemming uses a periodic inventory system.
(a) Determine the costs assigned to ending inventory and to cost of goods sold using FIFO.
(b) Determine the costs assigned to ending inventory and to cost of goods sold using LIFO.
(c) Compute the gross margin for each method.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3e6f79b5-3726-460b-8acf-af82b392005c%2Fb8c09092-e746-430c-8033-7ff9127ebd5a%2Fdwmaiuq.png&w=3840&q=75)
Transcribed Image Text:Required information
[The following information applies to the questions displayed below.]
Hemming Co. reported the following current-year purchases and sales for its only product
Activities
Units Acquired at Cost
200 units
Units Sold at Retail
Date
Jan. 1 Beginning inventory
Jan. 10 Sales
@ $10
=2,000
150 units
@$40
Mar. 14 Purchase
350 units
$15
5,250
Mar. 15 Sales
300 units
@$40
July 30 Purchase
Oct. 5 Sales
450 units
@$20
9,000
430 units
@$40
Oct. 26 Purchase
100 units
$25
2,500
$18,750
880 units
Totals
1,100 units
Required:
Hemming uses a periodic inventory system.
(a) Determine the costs assigned to ending inventory and to cost of goods sold using FIFO.
(b) Determine the costs assigned to ending inventory and to cost of goods sold using LIFO.
(c) Compute the gross margin for each method.
Transcribed Image Text:a) Periodic FIFO
Cost of Goods Available for Sale
Cost of Goods Sold
Ending Inventory
Cost of Goods#of units
#of units
Cost per
unit
Cost per
Ending
Goods Sold inventory per unit Inventory
Cost of
Cost
#of units
Available for
unit
sold
Sale
Beginning inventory
Purchases:
200
10.00 $
200 10.00
2,000
2,000
0
$ 15.00
15.00
March 14
350
5,250
350
5,250
0
$ 20.00
9,000
July 30
450
20.00
330
6,600
120
$20.00
2,400
25.00
October 26
100
$25.00
2,500
2,500
0
100
Total
880
220
1,100
18,750
$
13,850
$
4,900
b) Periodic LIFO
Cost of Goods Available for Sale
Cost of Goods Sold
Ending Inventory
Cost of Goods#of units
#of units
Cost per
Ending
Goods Sold inventory per unit Inventory
Cost per
unit
Cost of
Cost
of units
Available for
Sale
unit
sold
Beginning inventory
Purchases:
200 $
10.00
2,000
$
350
450 $
15.00
March 14
5,250
$ 20.00
9,000
July 30
20.00
450
9,000
100 25.00
100 $
October 26
25.00
2,500
2,500
Total
1,100
$
18,750
550
11,500
c) Gross Margin
FIFO
LIFO
Sales
35,200
35,200
Cost of goods sold
13,850
16,450
21,350$
Gross margin
18,750
e
6е
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