Question
In: Accounting
Riverside Inc. uses a perpetual iventory system and reports the following transactions for the month of...
Riverside Inc. uses a perpetual iventory system and reports the following transactions for the month of July. Show the inventory records using the FIFO,LIFO, and weighted Average methods. Under each method compute sales, cost of goods sold, and gross profit.
July 1 Beginning inventory 12 units cost/price $100.00
July 4 Purchase 8 units Cost//Price 103.00
July 9 Purchase 5 units Cost/Price 104.00
July 17 Sale 21 units Cost/Price 249.99
July 21 Purchase 4 units Cost/Price 106.00
July 31 Sale 6 units Cost/Price 249.99
Solutions
Expert Solution
FIFO
| Date | Purchase | Cost of goods sold | Balance | ||||||
| Unit | cost | total | Unit | Cost | Total | Unit | cost | total | |
| 1 july | 12 | $100 | $1200 | ||||||
| Balance | 12 | $100 | $1200 | ||||||
| july 4 | 8 | $103 | $824 | 12 | $100 | $1200 | |||
| 8 | $103 | $824 | |||||||
| Balance | 20 | $2024 | |||||||
| July 9 | 5 | $104 | $520 | 12 | $100 | $1200 | |||
| 8 | $103 | $824 | |||||||
| 5 | $104 | $520 | |||||||
| Balance | 25 | $2544 | |||||||
| July 17 | 12 | $100 | $1200 | ||||||
| 8 | $103 | $824 | |||||||
| 1 | $104 | $104 | 4 | $104 | $416 | ||||
| Balance | 4 | $416 | |||||||
| July 21 | 4 | $106 | $424 | 4 | $104 | $416 | |||
| 4 | $106 | $424 | |||||||
| Balance | 8 | $840 | |||||||
| July 31 | 4 | $104 | $416 | ||||||
| 2 | $106 | $212 | 2 | $106 | $212 | ||||
| 27 units | $2756 | 2 units | $212 | ||||||
Total sales = July 17 Sale [21 units Cost/Price 249.99 ] + July 31 Sale [6 units Cost/Price 249.99 ] = 21 * $249.99 + 6 * 249.99
= $5249.79 + $1499.94
= $6749.73
cost of goods sold = $2756
gross profit = Net sale - cost of goods sold
= $6749.73 - $2756
= $3993.73
Cost of Ending inventory = $212
LIFO
| Date | Purchase | Cost of goods sold | Balance | ||||||
| Unit | cost | total | Unit | Cost | Total | Unit | cost | total | |
| 1 july | 12 | $100 | $1200 | ||||||
| Balance | 12 | $100 | $1200 | ||||||
| july 4 | 8 | $103 | $824 | 12 | $100 | $1200 | |||
| 8 | $103 | $824 | |||||||
| Balance | 20 | $2024 | |||||||
| July 9 | 5 | $104 | $520 | 12 | $100 | $1200 | |||
| 8 | $103 | $824 | |||||||
| 5 | $104 | $520 | |||||||
| Balance | 25 | $2544 | |||||||
| July 17 | 5 | $104 | $520 | ||||||
| 8 | $103 | $824 | |||||||
| 8 | $100 | $800 | 4 | $100 | $400 | ||||
| Balance | 4 | $400 | |||||||
| July 21 | 4 | $106 | $424 | 4 | $100 | $400 | |||
| 4 | $106 | $424 | |||||||
| Balance | 8 | $824 | |||||||
| July 31 | 4 | $106 | $424 | ||||||
| 2 | $100 | $200 | 2 | $100 | $200 | ||||
| 27 units | $2768 | 2 units | $200 | ||||||
Total sales = July 17 Sale [21 units Cost/Price 249.99 ] + July 31 Sale [6 units Cost/Price 249.99 ] = 21 * $249.99 + 6 * 249.99
= $5249.79 + $1499.94
= $6749.73
cost of goods sold = $2768
gross profit = Net sale - cost of goods sold
= $6749.73 - $2768
= $3981.73
Cost of Ending inventory = $200
ekkarill92 answered 1 year agoRelated Solutions
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