Sunshine Store manages its inventory on a "First in, First out" basis. On 1 February2020, there were 20 units of stock costing $3 600.bought (up)Sold (CP)The business had the following credit transactions in February 2020:(a)(b)(c)2020₁(d)Feb 57920 XBought 10 unitsBought 20 unitsxSold 30 units XREQUIRED142022 Sold 20 unitsBought 10 unitsBought 10 units$1 4002-7006 400 (JP)2 000740038001 8004 600 (sr)30 (3600+ 1400.5000)20 (2700)SP-saver revenueExplain what is meant by "cost of sales".Calculate the cost of sales for the month ended 29 February 2020.Prepare the trading portion of the Statement of Financial Performance for themonth ended 29 February 2020.VsriExpenses,[3]State how ending inventory is valued.Income, cost of sales

Name: Sunshine Store manages its inventory on a "First in, First out" basis
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Description: Sunshine Store manages its inventory on a "First in, First out" basis. On 1 February2020, there were 20 units of stock costing $3 600.bought (up)Sold (CP)The business had the following credit transactions in February 2020:(a)(b)(c)2020₁(d)Feb 57920

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Sunshine Store manages its inventory on a "First in, First out" basis. On 1 February 2020, there were 20 units of stock costing $3 600. bought (up) Sold (CP) The business had the following credit transactions in February 2020: (a) (b) (c) 2020₁ (d) Feb 5 7 9 20 X Bought 10 units Bought 20 unitsx Sold 30 units X REQUIRED 14 20 22 Sold 20 units Bought 10 units Bought 10 units $ 1 400 2700 6 400 (JP) 2 000 1 800 4 600 (sr) 7000 3800 30 (3600+ 1400*3000) 20 (2700) SP-saver revenue Explain what is meant by "cost of sales". Calculate the cost of sales for the month ended 29 February 2020. Prepare the trading portion of the Statement of Financial Performance for the month ended 29 February 2020. SR, Expenses, [3] State how ending inventory is valued. Income, cost of sales

Sunshine Store manages its inventory on a "First in, First out" basis. On 1 February 2020, there were 20 units of stock costing $3 600. bought (up) Sold (CP) The business had the following credit transactions in February 2020: (a) (b) (c) 2020₁ (d) Feb 5 7 9 20 X Bought 10 units Bought 20 unitsx Sold 30 units X REQUIRED 14 20 22 Sold 20 units Bought 10 units Bought 10 units $ 1 400 2700 6 400 (JP) 2 000 1 800 4 600 (sr) 7000 3800 30 (3600+ 1400*3000) 20 (2700) SP-saver revenue Explain what is meant by "cost of sales". Calculate the cost of sales for the month ended 29 February 2020. Prepare the trading portion of the Statement of Financial Performance for the month ended 29 February 2020. SR, Expenses, [3] State how ending inventory is valued. Income, cost of sales

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 5MC: The moving average inventory cost flow assumption is applicable to which of the following inventory...

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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.
On September 30, 2013, the general ledger of Leons Golf Shop, which uses the calendar year as its accounting period, showed the following year-to-date account balances: The merchandise inventory account had a 48,000 balance on January 1, 2013. The historical gross profit percentage is 40%. Leon prepares quarterly financial statements and takes physical inventory once a yearat the end of the accounting period. In order to prepare the financial statements for the third quarter, the store needs to have an estimate of ending inventory. You have been asked to use the gross profit method to estimate the ending inventory. Review the worksheet called GP. Study it carefully because it may have a solution format somewhat different from the one shown in your textbook.
Jessie Stores uses the periodic system of calculating inventory. The following information is available for December of the current year when Jessie sold 500 units of inventory. Using the FIFO method, calculate Jessies inventory on December 31 and its cost of goods sold for December.
Jessie Stores uses the periodic system of calculating inventory. The following information is available for December of the current year when Jessie sold 500 units of inventory. Using the FIFO method, calculate Jessies inventory on December 31 and its cost of goods sold for December. RE7-11 Using the information from RE7-10, calculate Jessie Storess inventory on December 31 and its cost of goods sold for December using the LIFO method.
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The moving average inventory cost flow assumption is applicable to which of the following inventory systems? Questions M7-6 and M7-7 are based on the following data: City Stationers Inc. had 200 calculators on hand on January 1, 2019, costing 18 each. Purchases and sales of calculators during the month of January were as follows: City uses a periodic inventory system. According to a physical count, 150 calculators were on hand at January 31, 2019.
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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: Sales: 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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At December 31, 2019, the following information was available from Crisford Companys books: Sales for the year totaled 110,600; markdowns amounted to 1,400. Under the approximate lower of average cost or market retail method, Crisfords inventory at December 31, 2019, was: a. 30,800 b. 28.000 c. 21,560 d. 19,600
On June 30, 2019, the balances of the accounts appearing in the ledger of Simkins Company are as follows: Instructions 1. Does Simkins Company use a periodic or perpetual inventory system? Explain. 2. Prepare a multiple-step income statement for Simkins Company for the year ended June 30, 2019. The merchandise inventory as of June 30, 2019, was 508,000. The adjustment for estimated returns inventory for sales for the year ending December 31, 2019, was 33,000. 3. Prepare the closing entries for Simkins Company as of June 30, 2019. 4. What would the net income have been if the perpetual inventory system had been used?
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?