Question

20. The following pertain to the cost of H’s only inventory item:

• Inventory on hand, January 1                                                 295 units @ $50 per unit
• Purchases, January 12                                                            590 units @ $88 per unit
• Purchases, January 20                                                             450 units @ $91 per unit
• Purchases, January 31                                                            300 units @ $93 per unit

1,635

• Sales, January 5                                                                         75 units @ $200 per unit
• Sales, January 15                                                                     350 units @ $200 per unit
• Sales, January 22                                                                     550 units @ $200 per unit
• Sales, January 30                                                                     140 units @ $200 per unit

1,115                                          (1,115 x $200 = $223,000)

Calculate COGS AND GP for January AND EI as of 01-31 assuming H uses perpetual LIFO

EI:                                                                                   

COGS:                                                                           

Gross profit:                                                                  

Calculate COGS AND GP for January AND EI as of 01-31 assuming H uses a moving average method and rounds the unit cost to the nearest penny each time it performs an average calculation

EI:                                                                                   

COGS:                                                                           

Gross profit:                                                                  

Make sure that the sum of your COGS AND EI answers add up to 100% of your COGAS.

Answer 1