Question

Following is a list of inventory transactions for NET P/L (unit cost is GST exc amount). NET P/L uses a perpetual average cost inventory system.

1. Complete the inventory table below .

2. Answer the questions following the table

All answers are numbers which consist only of the digits 0 to 9. Symbols or punctuation marks should NOT be incorporated in answers.

Each box must be completed. If there is no value enter 0 (zero).

Date	Description	Quantity	Unit Cost
01/06/18	On Hand	10	100
08/06/18	Purchase	10	160
10/06/18	Purchase	10	190
17/06/18	Sale	18

  

	Purchases				Cost of Sales				Inventory On Hand
Date	Qty	Unit Cost	Total Cost		Qty	Unit Cost	Total Cost		Qty	Unit Cost	Total Cost
01/06/18									10	100	1000
08/06/18	10	Answer	Answer		Answer	Answer	Answer		Answer	Answer	Answer
10/06/18	10	Answer	Answer		Answer	Answer	Answer		Answer	Answer	Answer
17/06/18	Answer	Answer	Answer		Answer	Answer	Answer		Answer	Answer	Answer

At what amount is inventory recorded?	AnswerCost (inc GST)Cost (exc GST)Selling Price
What is Revenue less Cost Of Sales?	AnswerGross ProfitNet ProfitThe Accounting Equation
What is the Total Cost of Sales in the above example?	Answer27001800
If inventory from the 10/06/18 purchase were returned, what unit cost would it be recorded at?

Answer 1

	W.Avg	Purchases	Cost of Goods Sold	Ending Balance
Date	Activity	Units	Unit Price	Amount	Units	Unit Price	Amount	Units	Unit Price	Amount
01/06/18	Purchase							10	$      100.00	$   1,000.00
08/06/18	Purchase	10	$      160.00	$   1,600.00				20	$      130.00	$   2,600.00
10/06/18	Purchase	10	$      190.00	$   1,900.00				30	$      150.00	$   4,500.00
17/06/18	Sales				18	$      150.00	$   2,700.00	12	$      150.00	$   1,800.00
	Total	20		$   3,500.00	18		$   2,700.00	12		$   1,800.00

Amount of inventory recorded = $1800 i.e. Cost (Exc GST)

Revenue less Cost Of Sales = Gross Profit

Purchase return will be recorded at purchase price i.e. $190