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FIFO Perpetual Inventory The beginning inventory at Dunne Co. and data on purchases and sales for...
FIFO Perpetual Inventory
The beginning inventory at Dunne Co. and data on purchases and sales for a three-month period ending June 30 are as follows:
| Date | Transaction | Number of Units |
Per Unit | Total | ||||
|---|---|---|---|---|---|---|---|---|
| Apr. 3 | Inventory | 90 | $300 | $27,000 | ||||
| 8 | Purchase | 180 | 360 | 64,800 | ||||
| 11 | Sale | 120 | 1,000 | 120,000 | ||||
| 30 | Sale | 75 | 1,000 | 75,000 | ||||
| May 8 | Purchase | 150 | 400 | 60,000 | ||||
| 10 | Sale | 90 | 1,000 | 90,000 | ||||
| 19 | Sale | 45 | 1,000 | 45,000 | ||||
| 28 | Purchase | 150 | 440 | 66,000 | ||||
| June 5 | Sale | 90 | 1,050 | 94,500 | ||||
| 16 | Sale | 120 | 1,050 | 126,000 | ||||
| 21 | Purchase | 270 | 480 | 129,600 | ||||
| 28 | Sale | 135 | 1,050 | 141,750 | ||||
Required:
1. Record the inventory, purchases, and cost of merchandise sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the first-in, first-out method. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Goods Sold Unit Cost column and in the Inventory Unit Cost column.
| Dunne Co. Schedule of Cost of Goods Sold FIFO Method For the Three Months Ended June 30 |
|||||||||
|---|---|---|---|---|---|---|---|---|---|
| Purchases | Cost of Goods Sold | Inventory | |||||||
| Date | Quantity | Unit Cost | Total Cost | Quantity | Unit Cost | Total Cost | Quantity | Unit Cost | Total Cost |
| Apr. 3 | $ | $ | |||||||
| Apr. 8 | $ | $ | |||||||
| Apr. 11 | $ | $ | |||||||
| Apr. 30 | |||||||||
| May 8 | |||||||||
| May 10 | |||||||||
| May 19 | |||||||||
| May 28 | |||||||||
| June 5 | |||||||||
| June 16 | |||||||||
| June 21 | |||||||||
| June 28 | |||||||||
| June 30 | Balances | $ | $ | ||||||
2. Determine the total sales and the total cost of goods sold for the period. Journalize the entries in the sales and cost of goods sold accounts. Assume that all sales were on account.
| Record sale | |||
| Record cost | |||
3. Determine the gross profit from sales for
the period.
$
4. Determine the ending inventory cost as of
June 30.
$
5. Based upon the preceding data, would you expect the ending inventory using the last-in, first-out method to be higher or lower?
Solutions
Expert Solution
| STATEMENT SHOWING INVENTORY RECORD UNDER PERPETUAL FIFO METHOD | |||||||||
| RECIEPTS | COST OF GOODS SOLD | BALANCE | |||||||
| DATE | UNITS | RATE | AMOUNT $ | UNITS | RATE | AMOUNT $ | UNITS | RATE | AMOUNT $ |
| 03-Apr | 90 | 300 | 27000 | ||||||
| 08-Apr | 180 | 360 | 64800 | 90 | 300 | 27000 | |||
| 180 | 360 | 64800 | |||||||
| 11-Apr | 90 | 300 | 27000 | ||||||
| 30 | 360 | 10800 | 150 | 360 | 54000 | ||||
| 30-Apr | 75 | 360 | 27000 | 75 | 360 | 27000 | |||
| 08-May | 150 | 400 | 60000 | 75 | 360 | 27000 | |||
| 150 | 400 | 60000 | |||||||
| 10-May | 75 | 360 | 27000 | ||||||
| 15 | 400 | 6000 | 135 | 400 | 54000 | ||||
| 19-May | 45 | 400 | 18000 | 90 | 400 | 36000 | |||
| 28-May | 150 | 440 | 66000 | 90 | 400 | 36000 | |||
| 150 | 440 | 66000 | |||||||
| 05-Jun | 90 | 400 | 36000 | 150 | 440 | 66000 | |||
| 16-Jun | 120 | 440 | 52800 | 30 | 440 | 13200 | |||
| 21-Jun | 270 | 480 | 129600 | 30 | 440 | 13200 | |||
| 270 | 480 | 129600 | |||||||
| 28-Jun | 30 | 440 | 13200 | ||||||
| 105 | 480 | 50400 | 165 | 480 | 79200 | ||||
| TOTAL | 750 | 320400 | 675 | 268200 | 165 | 79200 | |||
| Sales revenue (120000+75000+90000+45000+94500+126000+141750): | 692250 | ||||||||
| Req 2. | |||||||||
| Journal entries | |||||||||
| S.no. | Accounts title and explanations | Debit $ | Credit $ | ||||||
| a. | Accounts receivable | 692250 | |||||||
| Sales revenue | 692250 | ||||||||
| (for sales made on account) | |||||||||
| b. | Cost of goods sold | 268200 | |||||||
| Merchandise inventory | 268200 | ||||||||
| (for cost of goods sold) | |||||||||
| Req 3. | |||||||||
| Gross Profit: | |||||||||
| Sales revenue | 692250 | ||||||||
| Less: Cost of goods sold | 268200 | ||||||||
| Gross Profit: | 424050 |
 ekkarill92 answered 1 year agoRelated SolutionsFIFO Perpetual Inventory The beginning inventory at Dunne Co. and data on purchases and sales for...FIFO Perpetual Inventory
The beginning inventory at Dunne Co. and data on purchases and
sales for a three-month period ending June 30 are as follows:
Date
Transaction
Number
of Units
Per Unit
Total
Apr. 3
Inventory
90
$450
$40,500
8
Purchase
180
540
97,200
11
Sale
120
1,500
180,000
30
Sale
75
1,500
112,500
May 8
Purchase
150
600
90,000
10
Sale
90
1,500
135,000
19
Sale
45
1,500
67,500
28
Purchase
150
660
99,000
June 5
Sale
90
1,575...
FIFO Perpetual Inventory The beginning inventory at Dunne Co. and data on purchases and sales for...FIFO Perpetual Inventory
The beginning inventory at Dunne Co. and data on purchases and
sales for a three-month period ending June 30 are as follows:
Date
Transaction
Number
of Units
Per Unit
Total
Apr. 3
Inventory
60
$225
$13,500
8
Purchase
120
270
32,400
11
Sale
80
750
60,000
30
Sale
50
750
37,500
May 8
Purchase
100
300
30,000
10
Sale
60
750
45,000
19
Sale
30
750
22,500
28
Purchase
100
330
33,000
June 5
Sale
60
790...
FIFO Perpetual Inventory The beginning inventory at Dunne Co. and data on purchases and sales for...FIFO Perpetual Inventory
The beginning inventory at Dunne Co. and data on purchases and
sales for a three-month period ending June 30 are as follows:
Date
Transaction
Number
of Units
Per Unit
Total
Apr. 3
Inventory
25
$1,200
$30,000
8
Purchase
75
1,240
93,000
11
Sale
40
2,000
80,000
30
Sale
30
2,000
60,000
May 8
Purchase
60
1,260
75,600
10
Sale
50
2,000
100,000
19
Sale
20
2,000
40,000
28
Purchase
80
1,260
100,800
June 5
Sale
40
2,250...
FIFO Perpetual Inventory The beginning inventory at Dunne Co. and data on purchases and sales for...FIFO Perpetual Inventory
The beginning inventory at Dunne Co. and data on purchases and
sales for a three-month period ending June 30 are as follows:
Date
Transaction
Number
of Units
Per Unit
Total
Apr. 3
Inventory
48
$225
$10,800
8
Purchase
96
270
25,920
11
Sale
64
750
48,000
30
Sale
40
750
30,000
May 8
Purchase
80
300
24,000
10
Sale
48
750
36,000
19
Sale
24
750
18,000
28
Purchase
80
330
26,400
June 5
Sale
48
790...
FIFO Perpetual Inventory The beginning inventory at Dunne Co. and data on purchases and sales for...FIFO Perpetual Inventory
The beginning inventory at Dunne Co. and data on purchases and
sales for a three-month period ending June 30 are as follows:
Date
Transaction
Number
of Units
Per Unit
Total
Apr. 3
Inventory
66
$300
$19,800
8
Purchase
132
360
47,520
11
Sale
88
1,000
88,000
30
Sale
55
1,000
55,000
May 8
Purchase
110
400
44,000
10
Sale
66
1,000
66,000
19
Sale
33
1,000
33,000
28
Purchase
110
440
48,400
June 5
Sale
66
1,050...
FIFO Perpetual Inventory The beginning inventory at Dunne Co. and data on purchases and sales for...FIFO Perpetual Inventory
The beginning inventory at Dunne Co. and data on purchases and
sales for a three-month period ending June 30 are as follows:
Date
Transaction
Number
of Units
Per Unit
Total
Apr. 3
Inventory
72
$450
$32,400
8
Purchase
144
540
77,760
11
Sale
96
1,500
144,000
30
Sale
60
1,500
90,000
May 8
Purchase
120
600
72,000
10
Sale
72
1,500
108,000
19
Sale
36
1,500
54,000
28
Purchase
120
660
79,200
June 5
Sale
72
1,575...
FIFO Perpetual Inventory The beginning inventory at Dunne Co. and data on purchases and sales for...FIFO Perpetual Inventory
The beginning inventory at Dunne Co. and data on purchases and
sales for a three-month period ending June 30 are as follows:
Date
Transaction
Number
of Units
Per Unit
Total
Apr. 3
Inventory
84
$450
$37,800
8
Purchase
168
540
90,720
11
Sale
112
1,500
168,000
30
Sale
70
1,500
105,000
May 8
Purchase
140
600
84,000
10
Sale
84
1,500
126,000
19
Sale
42
1,500
63,000
28
Purchase
140
660
92,400
June 5
Sale
84
1,575...
FIFO Perpetual Inventory The beginning inventory at Dunne Co. and data on purchases and sales for...FIFO Perpetual Inventory The beginning inventory at Dunne Co.
and data on purchases and sales for a three-month period ending
June 30 are as follows: Date Transaction Number of Units Per Unit
Total Apr. 3 Inventory 42 $525 $22,050 8 Purchase 84 630 52,920 11
Sale 56 1,750 98,000 30 Sale 35 1,750 61,250 May 8 Purchase 70 700
49,000 10 Sale 42 1,750 73,500 19 Sale 21 1,750 36,750 28 Purchase
70 770 53,900 June 5 Sale 42 1,840...
FIFO Perpetual Inventory The beginning inventory at Dunne Co. and data on purchases and sales for...FIFO Perpetual Inventory
The beginning inventory at Dunne Co. and data on purchases and
sales for a three-month period ending June 30 are as follows:
Date
Transaction
Number
of Units
Per Unit
Total
Apr. 3
Inventory
48
$525
$25,200
8
Purchase
96
630
60,480
11
Sale
64
1,750
112,000
30
Sale
40
1,750
70,000
May 8
Purchase
80
700
56,000
10
Sale
48
1,750
84,000
19
Sale
24
1,750
42,000
28
Purchase
80
770
61,600
June 5
Sale
48
1,840...
FIFO Perpetual Inventory The beginning inventory at Dunne Co. and data on purchases and sales for...FIFO Perpetual Inventory
The beginning inventory at Dunne Co. and data on purchases and
sales for a three-month period ending June 30 are as follows:
Date
Transaction
Number
of Units
Per Unit
Total
Apr. 3
Inventory
78
$450
$35,100
8
Purchase
156
540
84,240
11
Sale
104
1,500
156,000
30
Sale
65
1,500
97,500
May 8
Purchase
130
600
78,000
10
Sale
78
1,500
117,000
19
Sale
39
1,500
58,500
28
Purchase
130
660
85,800
June 5
Sale
78
1,575...
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