Question

In: Accounting

When the perpetual inventory method is used, which is normal when a company uses job order...

When the perpetual inventory method is used, which is normal when a company uses job order costing, the Statement of Cost of Goods Manufactured, shown in your textbook on p. 902,

is not necessary.
contains both a sales entry and a cost of good sold entry.
has, as its main objective, a reconciliation of beginning and ending balances in the Cost of Goods Sold account.
is required by the Securities and Exchange Commission in the company's annual report.

Solutions

Expert Solution

C. The statement of goods manufactured actually supports the cost of goods sold figure in income statement.

Reconciling the beginning and ending inventory and to calculate how much of inventory produced during the period and is ready for sale.


Related Solutions

Inventory Costing Methods-Perpetual Method Kali Company uses the perpetual inventory system for its merchandise inventory. The...
Inventory Costing Methods-Perpetual Method Kali Company uses the perpetual inventory system for its merchandise inventory. The June 1 inventory for one of the items in the merchandise inventory consisted of 60 units with a unit cost of $45. Transactions for this item during June were as follows: June 5 Purchased 40 units @ $50 per unit 13 Sold 50 units @ $95 per unit 25 Purchased 40 units @ $53 per unit 29 Sold 20 units@ $110 per unit Required...
Inventory Costing Methods—Perpetual Method Arrow Company is a retailer that uses the perpetual inventory system. August...
Inventory Costing Methods—Perpetual Method Arrow Company is a retailer that uses the perpetual inventory system. August 1 Beginning inventory 80 units of Product A @ $1,600 total cost 5 Purchased 100 units of Product A @ $2,116 total cost 8 Purchased 200 units of Product A @ $4,416 total cost 11 Sold 170 units of Product A @ $4,800 total sale Calculate the inventory cost of item A on August 11 (after the sale) using (a) first-in, first-out, (b) last-in,...
Your company, which uses the perpetual method, purchases inventory for $7,000 on account. Before paying the...
Your company, which uses the perpetual method, purchases inventory for $7,000 on account. Before paying the invoice, your firm returns damaged goods for a $650 credit. What is the journal entry to record this return? debit Cost of Goods Sold; credit Inventory debit Accounts Payable; credit Cost of Goods Sold debit Accounts Payable; credit Purchase Returns and Allowances debit Purchase Returns and Allowances; credit Accounts Payable debit Accounts Payable; credit Inventory
Morse Inc. is a retail company that uses the perpetual inventory method. Assume that there are...
Morse Inc. is a retail company that uses the perpetual inventory method. Assume that there are no credit transactions; all amounts are settled in cash. You have the following information for Morse Inc. for the month of January 2014. Date Dec. 31 Jan. 2 Jan. 6 Jan. 9 Jan. 10 Jan. 23 Jan. 30 Description Ending inventory Purchase Sale Purchase Sale Purchase Sale Unit Cost or Quantity Selling Price 140 $14 120 15 150 30 85 17 70 35 100...
When the perpetual inventory method is being used, the accountant debits __________ __________ and credits Accounts...
When the perpetual inventory method is being used, the accountant debits __________ __________ and credits Accounts Payable (or Cash) when goods are purchased and debits Cost of Goods Sold and credits __________ __________ when gods are sold, along with the proper sales entry. When prices are rising, LIFO inventory is __________ (higher or lower) than FIFO inventory at the end of the year. This will cause the cost of goods sold under LIFO to be __________ (higher or lower) than...
Malibu Boats Inc. uses a job order cost accounting system and keeps perpetual inventory records. The...
Malibu Boats Inc. uses a job order cost accounting system and keeps perpetual inventory records. The following transactions occurred in the first month of operations: Purchased raw materials on account, $230,000. 2. An analysis of the requisitions shows the following: Direct materials requisitioned during the month:               Job 101     $26,000               Job 102      19,000               Job 103      31,000    $76,000 Factory labor costs incurred were $85,000 of which $71,000 pertained to factory wages payable and $14,000 pertained to employer payroll...
A company that uses the gross method of recording purchases and a perpetual inventory system made...
A company that uses the gross method of recording purchases and a perpetual inventory system made a purchase of $2,200 with terms of 2/10, n/30. The entry to record the purchase would be: Debit Merchandise Inventory $2,156; credit Accounts Payable $2,156. Debit Merchandise Inventory $2,200; credit Accounts Payable $2,200. Debit Merchandise Inventory $2,156; credit Cash for $2,156. Debit Merchandise Inventory $2,156; debit Discounts Lost $44; credit Accounts Payable $2,200. Debit Accounts Payable $2,200; credit Discounts Lost $44; credit Cash $2,156.
The following information is available for the month ofApril. The company uses the perpetual inventory method....
The following information is available for the month ofApril. The company uses the perpetual inventory method. April 1 inventory balance 120 units @$8.04 each April 10purchase 200 units @ $8.20 each April 20purchase 410 units @ $8.40 each April 22sale 630 units @ $15.00 each April 25purchase 310 units @ $8.59 each a. Compute the value of ending inventory under LIFO,show steps. b. Compute the value of ending inventory under FIFO,show steps. c. Which inventory costing method results in the...
Inventory Costing Methods-Perpetual Method Fortune Stores uses the perpetual inventory system for its merchandise inventory. The...
Inventory Costing Methods-Perpetual Method Fortune Stores uses the perpetual inventory system for its merchandise inventory. The April 1 inventory for one of the items in the merchandise inventory consisted of 130 units with a unit cost of $335. Transactions for this item during April were as follows: April 9 Purchased 40 units @ $355 per unit 14 Sold 80 units @ 560 per unit 23 Purchased 20 units @ 360 per unit 29 Sold 40 units Required a. Calculate the...
1.Charter Company, which uses the perpetual inventory method, purchases different letters for resale. Charter had a...
1.Charter Company, which uses the perpetual inventory method, purchases different letters for resale. Charter had a beginning inventory comprised of ten units at $3 per unit. The company purchased four units at $5 per unit in February, sold seven units in October, and purchased four units at $6 per unit in December. If Charter Company uses the LIFO method, what is the cost of its ending inventory? 2. Delta Diamonds uses a periodic inventory system. The company had five one-carat...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT