In: Accounting
Hemming Co. reported the following current-year purchases and sales for its only product.
Date | Activities | Units Acquired at Cost | Units Sold at Retail | |||||||||||||
Jan. | 1 | Beginning inventory | 125 | units | @ $11.00 | = | $ | 1,375 | ||||||||
Jan. | 10 | Sales | 115 | units | @ $41.00 | |||||||||||
Mar. | 14 | Purchase | 275 | units | @ $16.00 | = | 4,400 | |||||||||
Mar. | 15 | Sales | 165 | units | @ $41.00 | |||||||||||
July | 30 | Purchase | 425 | units | @ $21.00 | = | 8,925 | |||||||||
Oct. | 5 | Sales | 275 | units | @ $41.00 | |||||||||||
Oct. | 26 | Purchase | 625 | units | @ $26.00 | = | 16,250 | |||||||||
Totals | 1,450 | units | $ | 30,950 | 555 | units | ||||||||||
Required:
Hemming uses a perpetual inventory system. (Round cost per unit to 2 decimal places.)
(a) Determine the costs assigned to ending inventory and to cost of goods sold using FIFO.
(b) Determine the costs assigned to ending inventory and to cost of goods sold using LIFO.
(c) Compute the gross margin for each method.
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*Red text indicates no response was expected in a cell or a formula-based calculation is incorrect; no points deducted.
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*Red text indicates no response was expected in a cell or a formula-based calculation is incorrect; no points deducted.