Trends by Tiffany sells high-end leather purses. The company has the following inventory transactions for the year. Date Transactions Units Unit Cost Unit Cost Jan. 1 Beginning inventory 20 $500 $10,000 Apr. 9 Purchase 30 520 15,600 Oct. 4 Purchase 11 550 6,050 61 $31,650 Jan. 1–Dec. 31 Sales 52 Required:1. Using FIFO, calculate ending inventory and cost of goods sold.2. Using LIFO, calculate ending inventory and cost of goods sold.3. Because trends in purses change frequently, Trends by Tiffany estimates that the remaining nine purses have a net realizable value at December 31 of only $350 each. Determine the amount of ending inventory to report using lower of cost and net realizable value under FIFO. Record any necessary adjustment.
Trends by Tiffany sells high-end leather purses. The company has the following inventory transactions for the year. Date Transactions Units Unit Cost Unit Cost Jan. 1 Beginning inventory 20 $500 $10,000 Apr. 9 Purchase 30 520 15,600 Oct. 4 Purchase 11 550 6,050 61 $31,650 Jan. 1–Dec. 31 Sales 52 Required:1. Using FIFO, calculate ending inventory and cost of goods sold.2. Using LIFO, calculate ending inventory and cost of goods sold.3. Because trends in purses change frequently, Trends by Tiffany estimates that the remaining nine purses have a net realizable value at December 31 of only $350 each. Determine the amount of ending inventory to report using lower of cost and net realizable value under FIFO. Record any necessary adjustment.
Chapter18: Accounting Periods And Methods
Section: Chapter Questions
Problem 67P
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Question
Trends by Tiffany sells high-end leather purses. The company has the following inventory transactions for the year.
| Date | Transactions | Units | Unit Cost | Unit Cost |
| Jan. 1 | Beginning inventory | 20 | $500 | $10,000 |
| Apr. 9 | Purchase | 30 | 520 | 15,600 |
| Oct. 4 | Purchase | 11 | 550 | 6,050 |
| 61 | $31,650 | |||
| Jan. 1–Dec. 31 | Sales | 52 |
Required:
1. Using FIFO, calculate ending inventory and cost of goods sold.
2. Using LIFO, calculate ending inventory and cost of goods sold.
3. Because trends in purses change frequently, Trends by Tiffany estimates that the remaining nine purses have a net realizable value at December 31 of only $350 each. Determine the amount of ending inventory to report using lower of cost and net realizable value under FIFO. Record any necessary adjustment.
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