Simple Plan Enterprises uses a periodic inventory system. Its records showed the following: Inventory, December 31, using FIFO → 42 Units @ $16 = $672 Inventory, December 31, using LIFO 42 Units @ $12 = $504 Transactions in the Following Year Purchase, January 9 Units 54 Purchase, January 20 104 Unit Cost 17 18 Total Cost $ 918 1,872 Sale, January 11 (at $40 per unit) Sale, January 27 (at $41 per unit) 84 60 Required: 1. Compute the number and cost of goods available for sale, the cost of ending inventory, and the cost of goods sold under FIFO and LIFO. 2. Compute the inventory turnover ratio under the FIFO and LIFO inventory costing methods. 3. Does the inventory method used make a significant difference in the inventory turnover ratio? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Does the inventory method used make a significant difference in the inventory turnover ratio? O Yes ONO < Required 2 Required 3 >
Simple Plan Enterprises uses a periodic inventory system. Its records showed the following: Inventory, December 31, using FIFO → 42 Units @ $16 = $672 Inventory, December 31, using LIFO 42 Units @ $12 = $504 Transactions in the Following Year Purchase, January 9 Units 54 Purchase, January 20 104 Unit Cost 17 18 Total Cost $ 918 1,872 Sale, January 11 (at $40 per unit) Sale, January 27 (at $41 per unit) 84 60 Required: 1. Compute the number and cost of goods available for sale, the cost of ending inventory, and the cost of goods sold under FIFO and LIFO. 2. Compute the inventory turnover ratio under the FIFO and LIFO inventory costing methods. 3. Does the inventory method used make a significant difference in the inventory turnover ratio? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Does the inventory method used make a significant difference in the inventory turnover ratio? O Yes ONO < Required 2 Required 3 >
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 50E: Inventory Costing Methods Crandall Distributors uses a perpetual inventory system and has the...
Related questions
Topic Video
Question
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 6 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
College Accounting, Chapters 1-27
Accounting
ISBN:
9781337794756
Author:
HEINTZ, James A.
Publisher:
Cengage Learning,