INTERMEDIATE ACCOUNTING(LL)-W/CONNECT
9th Edition
ISBN: 9781260216141
Author: SPICELAND
Publisher: MCG CUSTOM
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Textbook Question
Chapter 8, Problem 8.15E
Comparison of FIFO and LIFO; periodic system
• LO8–1, LO8–4
Alta Ski Company’s inventory records contained the following information regarding its latest ski model. The company uses a periodic inventory system.
| Beginning inventory, January 1, 2018 | 600 units @ $80 each |
| Purchases: | |
| January 15 | 1,000 units @ $95 each |
| January 21 | 800 units @ $100 each |
| Sales: | |
| January 5 | 400 units @ $120 each |
| January 22 | 800 units @ $130 each |
| January 29 | 400 units @ $135 each |
| Ending inventory, January 31, 2018 | 800 units |
Required:
1. Which method, FIFO or LIFO, will result in the highest cost of goods sold figure for January 2018? Why? Which method will result in the highest ending inventory balance? Why?
2. Compute cost of goods sold for January and the ending inventory using both the FIFO and LIFO methods.
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Vaughn Manufacturing uses the perpetual inventory and the gross method. On March 1, it purchased $74000 of inventory, terms
2/10, n/30.bn March 3, Vaughn returned goods that cost $9000. On March 9, Vaughn paid the supplier. On March 9, Vaughn should
credit
O purchase discounts for $1300.
O purchase discounts for $1480.
O inventory for $1300.
O inventory for $1480.
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1 Beginning inventory 10 units @ $120
Purchase
14 Sale
21 Purchase
30 Sale
Use the inventory information for the month of June in the attachment to
June
60 units @ $112
40 units
30 units @ $116
answer the question below.
28 units
Q Zoom
Assuming that a periodic inventory system is used, what is cost of goods
sold on a FIFO basis? (Round the answer to the nearest dollar.)
Exercise 8.7 (Algo) Costing Inventory in a Periodic System (LO 8-4)
Rogers Products uses a periodic inventory system. The company's records show the beginning inventory of PH4 oil filters
on January 1 and the purchases of this item during the current year to be as follows.
Jan. 1
Feb. 23
Apr. 201
May 4
Nov. 30
Beginning inventory
Purchase
Purchase
Purchase
Purchase
Totals
a. Average cost
b. FIFO
C. LIFO
A physical count indicates 24 units in inventory at year-end.
Determine the cost of the ending inventory on the basis of each of the following methods of inventory valuation. (Remember
to use periodic inventory costing procedures.) (Round your intermediate and final answers to 2 decimal places.)
13 units@ $3.00 $ 39.00
16 units@ $3.50
56.00
28 units@ $3.80
106.40
140.00
35 units@ $4.00
19 units@ $5.00
111 units
95.00
$436.40
Ending
Inventory
Chapter 8 Solutions
INTERMEDIATE ACCOUNTING(LL)-W/CONNECT
Ch. 8 - Describe the three types of inventory of a...Ch. 8 - What is the main difference between a perpetual...Ch. 8 - The Cloud Company employs a perpetual inventory...Ch. 8 - The Bockner Company shipped merchandise to Laetner...Ch. 8 - What is a consignment arrangement? Explain the...Ch. 8 - Prob. 8.6QCh. 8 - The Esquire Company employs a periodic inventory...Ch. 8 - Prob. 8.8QCh. 8 - Its common in the electronics industry for unit...Ch. 8 - Explain why proponents of LIFO argue that it...
Ch. 8 - Prob. 8.11QCh. 8 - Describe the ratios used by financial analysts to...Ch. 8 - Prob. 8.13QCh. 8 - Prob. 8.14QCh. 8 - The Austin Company uses the dollar-value LIFO...Ch. 8 - Identify any differences between U.S. GAAP and...Ch. 8 - Determining ending inventory; periodic system ...Ch. 8 - Prob. 8.2BECh. 8 - Prob. 8.3BECh. 8 - Purchas e discounts; gross method LO83 On...Ch. 8 - Prob. 8.5BECh. 8 - Prob. 8.6BECh. 8 - Inventor y cost flow methods; perpetual system ...Ch. 8 - LIFO method LO84 Esquire Inc. uses the LIFO...Ch. 8 - LIFO method LO84 AAA Hardware uses the LIFO...Ch. 8 - LIFO liquidation LO86 Refer to the situation...Ch. 8 - Prob. 8.11BECh. 8 - Ratio analysis LO87 Selected financial statement...Ch. 8 - Dollar-value LIFO LO88 At the beginning of 2018,...Ch. 8 - Perpetual inventory system; journal entries LO81...Ch. 8 - Prob. 8.2ECh. 8 - Determining cost of goods sold; periodic inventory...Ch. 8 - Perpetual and periodic inventory systems compared ...Ch. 8 - Prob. 8.6ECh. 8 - Goods in transit; consignment LO82 The December...Ch. 8 - Physical quantities and costs included in...Ch. 8 - Prob. 8.9ECh. 8 - Prob. 8.10ECh. 8 - Prob. 8.11ECh. 8 - FASB codification research LO82, LO83 Access the...Ch. 8 - Inventory cost flow methods; periodic system ...Ch. 8 - Inventory cost flow methods; perpetual system ...Ch. 8 - Comparison of FIFO and LIFO; periodic system ...Ch. 8 - Average cost method; periodic and perpetual...Ch. 8 - FIFO, LIFO, and average cost methods LO81, LO84...Ch. 8 - Supplemental LIFO disclosures; LIFO reserve; AEP...Ch. 8 - LIFO liquidation LO81, LO84, LO86 The Reuschel...Ch. 8 - Dollar-value LIFO LO88 On January 1, 2018, the...Ch. 8 - Dollar-value LIFO LO88 Mercury Company has only...Ch. 8 - Dollar-value LIFO LO88 Carswell Electronics...Ch. 8 - Concepts; terminology LO81 through LO85 Listed...Ch. 8 - Various inventory transactions; journal entries ...Ch. 8 - Prob. 8.2PCh. 8 - Prob. 8.4PCh. 8 - Various inventory costing methods LO81, LO84...Ch. 8 - Various inventory costing methods LO81, LO84...Ch. 8 - Supple mental LIFO disclosures; Caterpillar LO84,...Ch. 8 - LIFO liquidation LO84, LO86 Taylor Corporation...Ch. 8 - LIFO liquidation LO84, LO86 Cansela Corporation...Ch. 8 - Prob. 8.11PCh. 8 - Integrating problem; inventories and accounts...Ch. 8 - Dollar-value LIFO LO88 On January 1, 2018, the...Ch. 8 - Dollar-value LIFO LO88 Kingston Company uses the...Ch. 8 - Dollar-value LIFO LO88 On January 1, 2018,...Ch. 8 - Prob. 8.1BYPCh. 8 - Real World Case 82 Physical quantities and costs...Ch. 8 - Judgment Case 83 The specific identification...Ch. 8 - Prob. 8.4BYPCh. 8 - Prob. 8.5BYPCh. 8 - Judgment Case 86 Goods in transit LO82 At the end...Ch. 8 - Ethics Case 87 Profit manipulation LO84 In 2017...Ch. 8 - Real World Case 88 Effects of inventory valuation...Ch. 8 - Real World Case 89 Effects of inventory valuation...Ch. 8 - Communication Case 810 Dollar-value LIFO method ...Ch. 8 - Prob. 8.11BYPCh. 8 - Prob. 8.CCTCCh. 8 - Prob. CCIFRS
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