Financial Accounting - Access
4th Edition
ISBN: 9781259958533
Author: SPICELAND
Publisher: MCG
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Textbook Question
Chapter 6, Problem 6.5BE
Calculate ending inventory and cost of goods sold using FIFO (LO6–3)
During the year, Wright Company sells 470 remote-control airplanes for $110 each. The company has the following inventory purchase transactions for the year.
Calculate ending inventory and cost of goods sold for the year, assuming the company uses FIFO.
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During the year, Wright Company sells 330 remote-control airplanes for $110 each. The company has the following inventory purchase transactions for the year. DateTransactionNumber of UnitsUnit CostTotal CostJan. 1Beginning inventory 60 $73 $4,380 May. 5Purchase 205 76 15,580 Nov. 3Purchase 110 81 8,910 375 $28,870
Calculate ending inventory and cost of goods sold for the year, assuming the company uses LIFO.
Sunland Company had the following inventory transactions occur during 2022:
Units
Cost/unit
Feb. 1, 2022
Purchase
104
$43
Mar. 14, 2022
Purchase
179
$45
May 1, 2022
Purchase
127
$47
The company sold 294 units at $60 each and has a tax rate of 30%. Assuming that a periodic inventory system is used, and operating expenses of $1728, what is the company’s after-tax income using LIFO?
$2007.60
$1699.60
$2428.00
$2868.00
During the year, Wright Company sells 435 remote-control airplanes for $120 each. The company has the following inventory purchase transactions for the year.
Date
Transaction
Number of Units
Unit Cost
Total Cost
Jan. 1
Beginning inventory
40
$
80
$
3,200
May. 5
Purchase
240
83
19,920
Nov. 3
Purchase
180
88
15,840
460
$
38,960
Calculate ending inventory and cost of goods sold for the year, assuming the company uses LIFO.
LIFO
Cost of Goods Available for Sale
Cost of Goods Sold
Ending Inventory
# of units
Cost per unit
Cost of Goods Available for Sale
# of units
Cost per unit
Cost of Goods Sold
# of units
Cost per unit
Ending Inventory
Beginning Inventory
not attempted
not attempted
$0
not attempted
$0
$0
not attempted
Purchases:
May 5
not attempted
not attempted
0
not attempted
$0
0
not attempted
Nov. 3
not attempted
not attempted
0
not attempted
$0
0
not attempted
Total
0…
Chapter 6 Solutions
Financial Accounting - Access
Ch. 6 - 1.What is inventory? Where in the financial...Ch. 6 - Prob. 2RQCh. 6 - What is the difference among raw materials...Ch. 6 - Prob. 4RQCh. 6 - Prob. 5RQCh. 6 - What is a multiple-step income statement? What...Ch. 6 - Cheryl believes that companies report cost of...Ch. 6 - What are the three primary cost flow assumptions?...Ch. 6 - 9.Which cost flow assumption generally results in...Ch. 6 - Prob. 10RQ
Ch. 6 - Prob. 11RQCh. 6 - 12.Explain how LIFO generally results in lower...Ch. 6 - Prob. 13RQCh. 6 - Explain how freight charges, purchase returns, and...Ch. 6 - Explain the method of reporting inventory at lower...Ch. 6 - 16.How is cost of inventory determined? How is net...Ch. 6 - 17.Describe the entry to adjust from cost to net...Ch. 6 - Prob. 18RQCh. 6 - Prob. 19RQCh. 6 - How is gross profit calculated? What is the gross...Ch. 6 - 21.Explain how the sale of inventory on account is...Ch. 6 - Prob. 22RQCh. 6 - Prob. 23RQCh. 6 - Prob. 24RQCh. 6 - Understand terms related to types of companies...Ch. 6 - Prob. 6.2BECh. 6 - Calculate cost of goods sold (LO62) At the...Ch. 6 - Prob. 6.4BECh. 6 - Calculate ending inventory and cost of goods sold...Ch. 6 - Calculate ending inventory and cost of goods sold...Ch. 6 - Calculate ending inventory and cost of goods sold...Ch. 6 - Prob. 6.8BECh. 6 - Identify financial statement effects of FIFO and...Ch. 6 - Prob. 6.10BECh. 6 - Record freight charges for inventory using a...Ch. 6 - Record purchase returns of inventory using a...Ch. 6 - Prob. 6.13BECh. 6 - Prob. 6.14BECh. 6 - Prob. 6.15BECh. 6 - Prob. 6.16BECh. 6 - Prob. 6.17BECh. 6 - Prob. 6.18BECh. 6 - Record purchase returns of inventory using a...Ch. 6 - Refer to the information in BE613, but now assume...Ch. 6 - Prob. 6.21BECh. 6 - Prob. 6.22BECh. 6 - Calculate cost of goods sold (LO62) Russell Retail...Ch. 6 - Prob. 6.2ECh. 6 - Prob. 6.3ECh. 6 - Calculate inventory amounts when costs are rising...Ch. 6 - Calculate inventory amounts when costs are...Ch. 6 - Record Inventory transactions using o perpetual...Ch. 6 - Record inventory purchase and purchase return...Ch. 6 - Prob. 6.8ECh. 6 - Prob. 6.9ECh. 6 - Prob. 6.10ECh. 6 - Record transactions using a perpetual system...Ch. 6 - Record transactions using a perpetual system...Ch. 6 - Calculate inventory using lower of cost and net...Ch. 6 - Prob. 6.14ECh. 6 - Calculate cost of goods sold, the inventory...Ch. 6 - Prob. 6.16ECh. 6 - Prob. 6.17ECh. 6 - Prob. 6.18ECh. 6 - Record inventory purchases and sales using a...Ch. 6 - Mulligan Corporation purchases inventory on...Ch. 6 - Complete the accounting cycle using Inventory...Ch. 6 - Calculate ending inventory and cost of goods sold...Ch. 6 - Prob. 6.2APCh. 6 - Prob. 6.3APCh. 6 - Prob. 6.4APCh. 6 - Calculate ending inventory end cost of goods sold...Ch. 6 - Record transactions using a perpetual system,...Ch. 6 - Prob. 6.7APCh. 6 - Prob. 6.8APCh. 6 - Record transactions and prepare a partial income...Ch. 6 - Prob. 6.10APCh. 6 - Calculate ending inventory and cost of goods sold...Ch. 6 - Prob. 6.2BPCh. 6 - Prob. 6.3BPCh. 6 - Prob. 6.4BPCh. 6 - Prob. 6.5BPCh. 6 - Record transactions using a perpetual system,...Ch. 6 - Prob. 6.7BPCh. 6 - Use the inventory turnover retio end gross profit...Ch. 6 - Record transactions and prepare a partial income...Ch. 6 - Determine the effects of inventory errors using...Ch. 6 - Great Adventures (This is a continuation of the...Ch. 6 - Prob. 6.2APFACh. 6 - Prob. 6.3APFACh. 6 - Comparative Analysis American Eagle Outfitters,...Ch. 6 - Prob. 6.5APECh. 6 - Prob. 6.6APIRCh. 6 - Written Communication You have just been hired as...Ch. 6 - Prob. 6.8APEM
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- Hogan Industries had the following inventory transactions occur during 2022: Units Cost/unit Feb. 1, 2022 Purchase 108 $45 Mar. 14, 2022 Purchase 186 $47 May 1, 2022 Purchase 132 $49 The company sold 306 units at $63 each and has a tax rate of 30%. Assuming that a periodic inventory system is used, what is the company’s gross profit using LIFO? (rounded to whole dollars)arrow_forwardOn July 19, 2021, SLRTN Inc. sold 19,000 units of its inventory to a customer for a total cash price ofP1,235,000. One unit costs the company P26. An excerpt in the contract of sale states that all goods may be returned by the customer to the seller within 31 days from purchase should the goods be of unsatisfactory quality. Based on past experience, 7% of the sold units are usually returned. The company employs a perpetual inventory system. The entries on July 19, 2021 will include all of the following, EXCEPT A. Debit to cash, P1,235,000 B. Debit to refund liability, P34,580 C. Credit to sales revenue, P1,148,550 D. Credit to inventory, P494,000arrow_forwardMontero Company maintains a perpetual inventory system and sells all its inventories at a price of P12 per unit. Montero has the following information pertaining to its inventory for the month of October: Units Unit cost Total cost Balance on 10/1 15,000 P6 P90,000 Purchased on 10/5 20,000 P9 P180,000 Sold on 10/20 18,000 Purchased on 10/25 12,000 P7 P84,000 Based on the above, answer the following (Round unit cost to two decimal places): What amount should Montero report as inventory on October 31 using the moving average method? ________________ What amount should Montero report as cost of goods sold for October using the weighted average method? ________________ Under the FIFO method, what amount should Montero report as gross profit for October? ________________arrow_forward
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