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In: Accounting

4. You extracted the following info from WAN Co. regarding its inventory transactions for last three...

4. You extracted the following info from WAN Co. regarding its inventory transactions for last three months. The Co. uses perpetual inventory system. Date Transactions # of Units Per Unit Total Oct 1 Inventory 2,500 $60.00 $150,000 Oct 10 Purchase 7,500 $68.00 $510,000 Oct 28 Sale 3,750 $120.00 $450,000 Oct 30 Sale 1,250 $120.00 $150,000 Nov 5 Sale 500 $120.00 $60,000 Nov10 Purchase 18,000 $70.00 $1,260,000 Nov16 Sale 9,000 $125.00 $1,125,000 Nov28 Sale 8,500 $125.00 $1,062,500 Dec 5 Purchase 15,000 $71.60 $1,074,000 Dec 14 Sale 10,000 $125.00 $1,250,000 Dec 25 Purchase 2,500 $72.00 $180,000 Dec 30 Sale 8,750 $125.00 $1,093,750 a. Record the inventory, purchases, and COGS data – using LIFO method. Follow Exhibit 5 in the book. 10 points b. Determine the total sales, total COGS, and gross profit for the period. 10 points c. Determine the ending inventory s of December 31.

Solutions

Expert Solution

STATEMENT SHOWING INVENTORY RECORD UNDER PERPETUAL LIFO METHOD
RECIEPTS COST OF GOODS SOLD BALANCE
DATE UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ UNITS RATE AMOUNT $
1-Oct 2500 60 150000
10-Oct 7500 68 510000 2500 60 150000
7500 68 510000
28-Oct 3750 68 255000 2500 60 150000
3750 68 255000
30-Oct 1250 68 85000 2500 60 150000
2500 68 170000
5-Nov 500 68 34000 2500 60 150000
2000 68 136000
10-Nov 18000 70 1260000 2500 60 150000
2000 68 136000
18000 70 1260000
16-Nov 9000 70 630000 2500 60 150000
2000 68 136000
9000 70 630000
28-Nov 8500 70 595000 2500 60 150000
2000 68 136000
500 70 35000
5-Dec 15000 71.6 1074000 2500 60 150000
2000 68 136000
500 70 35000
15000 71.6 1074000
14-Dec 10000 71.6 716000 2500 60 150000
2000 68 136000
500 70 35000
5000 71.6 358000
25-Dec 2500 72 180000 2500 60 150000
2000 68 136000
500 70 35000
5000 71.6 358000
2500 72 180000
30-Dec 2500 72 180000
5000 71.6 358000
500 70 35000 2500 60 150000
750 68 51000 1250 68 85000
TOTAL 43000 3024000 41750 2939000 3750 235000
Total sales:
28-Oct 450000
30-Oct 150000
5-Nov 60000
16-Nov 1125000
28-Nov 1062500
14-Dec 1250000
30-Dec 1093750
Ttotal sales 5191250
COGS:   $2939,000
Gross profit: Ssales -COGS = $ 5191,250 -2939,000 = $2252,250
Ending Inventory: $235,000

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