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In: Accounting
Q. 5 Prospect Ltd., which uses FIFO method of inventory management, began in June with 75...
Q. 5 Prospect Ltd., which uses FIFO method of inventory management, began in June with 75 units of inventory that cost $15 each. During June, it completed the following inventory transactions: Units Unit Cost Unit Sale Price June 7 Purchase 20 $16 June 13 Sale 71 $25 June 19 Purchase 38 $18 June 27 Sale 42 $27 Required a) Prepare a perpetual inventory record for internal reporting purposes under FIFO method. (marks: 8) b) Journalise, with explanations, the above transactions. (marks: 5) c) Prepare T accounts for Inventory, cost of sales and revenue. (marks: 3) d) Compute gross profit for Prospect Ltd. for June. (marks:1)
Solutions
ekkarill92 answered 2 years agoRelated Solutions
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Q. 5 (Total Marks: 10) Supreme Ltd. began with an inventory of
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signs on credit as follows: Purchase 1 65 signs @ $32 Sale 1 105
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A company that uses a FIFO inventory system and began operations in Year 1 has the...
A company that uses a FIFO inventory system and began operations
in Year 1 has the following information. Year 1 Year 2 Sales units
8,000 10,000 Selling price $45 $46 Production units 12,000 8,000
Unit direct material cost $2.00 $2.00 Unit direct labor cost $1.00
$1.00 Unit commission cost $.50 $.50 Annual Fixed Overhead $180,000
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inventoriable cost per unit in years 1 and 2? Absorption Costing
Variable Costing 2. What...
Blue Furniture Ltd. uses a perpetual inventory system and has a beginning inventory, as at June...
Blue Furniture Ltd. uses a perpetual inventory system and has a
beginning inventory, as at June 1, of 490 bookcases at a cost of
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sales of bookcases:
Purchases
Sales
Date
Units
Unit cost
Units
Unit price
June
6
1,200
$132
10
1,030
$204
14
1,770
133
16
1,670
209
26
960
134
(a)
Determine the cost of goods sold and the cost of the ending
inventory using the average...
Bramble Furniture Ltd. uses a perpetual inventory system and has a beginning inventory, as at June...
Bramble Furniture Ltd. uses a perpetual inventory system and has
a beginning inventory, as at June 1, of 520 bookcases at a cost of
$125 each. During June, the company had the following purchases and
sales of bookcases:
Purchases
Sales
Date
Units
Unit cost
Units
Unit price
June
6
1,170
$127
10
950
$216
14
1,750
128
16
1,600
221
26
1,040
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(a)
Correct answer iconYour answer is correct.
Determine the cost of goods sold and the cost of...
Goddard Company has used the FIFO method of inventory valuation since it began operations in 2015....
Goddard Company has used the FIFO method of inventory valuation
since it began operations in 2015. Goddard decided to change to the
average cost method for determining inventory costs at the
beginning of 2018. The following schedule shows year-end inventory
balances under the FIFO and average cost methods:
Year
FIFO
Average Cost
2015
$
47,000
$
58,000
2016
84,000
73,000
2017
91,000
84,000
Required:
1. Ignoring income taxes, prepare the 2018 journal
entry to adjust the accounts to reflect the...
Goddard Company has used the FIFO method of inventory valuation since it began operations in 2015....
Goddard Company has used the FIFO method of inventory valuation
since it began operations in 2015. Goddard decided to change to the
average cost method for determining inventory costs at the
beginning of 2018. The following schedule shows year-end inventory
balances under the FIFO and average cost methods:
Year
FIFO
Average Cost
2015
$
46,300
$
56,600
2016
81,900
72,300
2017
88,200
81,900
Required:
1. Ignoring income taxes, prepare the 2018 journal
entry to adjust the accounts to reflect the...
The Kay company currently uses FIFO for inventory valuation. Their records for year ended June 30,2007...
The Kay company currently uses FIFO for inventory valuation.
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July 1, 2006 inv 100,000 units at $7.50
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Sales during the year 350,000 units at $15
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cash balance on June 30,2006 250,000
income tax rate: 45%
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expense for fiscal 2007 of:
Maxell Company uses the FIFO method to assign costs to inventory and cost of goods sold....
Maxell Company uses the FIFO method to assign costs to inventory
and cost of goods sold. The company uses a periodic inventory
system. Consider the following information:
Date
Description
# of units
Cost per unit
January 1
Beginning inventory
160
$
6
June 2
Purchase
90
$
5
November 5
Sales
170
What amounts would be reported as the cost of goods sold and ending
inventory balances for the year?
Multiple Choice
a. Cost of goods sold $1,070; Ending inventory...
Maxell Company uses the FIFO method to assign costs to inventory and cost of goods sold....
Maxell Company uses the FIFO method to assign costs to inventory
and cost of goods sold. The company uses a periodic inventory
system. Consider the following information:
Date
Description
# of units
Cost per unit
January 1
Beginning inventory
280
$
6
June 2
Purchase
75
$
5
November 5
Sales
305
What amounts would be reported as the cost of goods sold and
ending inventory balances for the year?
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Danville Bottlers is a wholesale beverage company. Danville uses
the FIFO inventory method to determine the cost of its ending
inventory. Ending inventory quantities are determined by a physical
count. For the accounting year-end December 31, 2021, ending
inventory was originally determined to be $3,265,000. However, on
January 17, 2022, John Howard, the company’s controller, discovered
an error in the ending inventory count. He determined that the
correct ending inventory amount should be $2,600,000.
Danville is a privately owned corporation...
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