In: Accounting
LIFO Perpetual Inventory
The beginning inventory at Funky Party Supplies and data on purchases and sales for a three-month period are as follows:
Date | Transaction | Number of Units |
Per Unit | Total | ||||
---|---|---|---|---|---|---|---|---|
Jan. 1 | Inventory | 2,500 | $60.00 | $150,000 | ||||
10 | Purchase | 7,500 | 68.00 | 510,000 | ||||
28 | Sale | 3,750 | 120.00 | 450,000 | ||||
30 | Sale | 1,250 | 120.00 | 150,000 | ||||
Feb. 5 | Sale | 500 | $120.00 | $60,000 | ||||
10 | Purchase | 18,000 | 70.00 | 1,260,000 | ||||
16 | Sale | 9,000 | 125.00 | 1,125,000 | ||||
28 | Sale | 8,500 | 125.00 | 1,062,500 | ||||
Mar. 5 | Purchase | 15,000 | 71.60 | 1,074,000 | ||||
14 | Sale | 10,000 | 125.00 | 1,250,000 | ||||
25 | Purchase | 2,500 | 72.00 | 180,000 | ||||
30 | Sale | 8,750 | 125.00 | 1,093,750 |
Required:
1. Record the inventory, purchases, and cost of merchandise sold data in a perpetual inventory record similar to the one illustrated in Exhibit 5, using the last-in, first-out method. Under LIFO, if units are in inventory at two different costs, enter the units with the HIGHER unit cost first in the Cost of Merchandise Sold Unit Cost column and LOWER unit cost first in the Inventory Unit Cost column. Round unit cost to two decimal places, if necessary.
Funky Party Supplies Schedule of Cost of Merchandise Sold LIFO Method For the three months ended March 31, 2016 |
|||||||||
---|---|---|---|---|---|---|---|---|---|
Purchases | Cost of Merchandise Sold | Inventory | |||||||
Date | Quantity | Unit Cost | Total Cost | Quantity | Unit Cost | Total Cost | Quantity | Unit Cost | Total Cost |
Jan. 1 | $ | $ | |||||||
Jan. 10 | $ | $ | |||||||
Jan. 28 | $ | $ | |||||||
Jan. 30 | |||||||||
Feb. 5 | |||||||||
Feb. 10 | |||||||||
Feb. 16 | |||||||||
Feb. 28 | |||||||||
Mar. 5 | |||||||||
Mar. 14 | |||||||||
Mar. 25 | |||||||||
Mar. 30 | |||||||||
Mar. 31 | Balances | $ | $ |
2. Determine the total sales, the total cost of merchandise sold, and the gross profit from sales for the period.
Total sales | $ |
Total cost of merchandise sold | $ |
Gross profit from sales | $ |
3. Determine the ending inventory cost as of
March 31, 2016.
$
Calculate cost of goods sold and ending inventory under LIFO perpetual method :
Purchase | Cost of goods sold | Inventory | |||||||
Date | Qty | Unit cost | Total cost | Qty | unit cost | Total cost | Qty | Unit cost | Total cost |
Jan 1 | 2500 | 60 | 150000 | ||||||
Jan 10 | 7500 | 68 | 510000 |
2500 7500 |
60 68 |
150000 510000 |
|||
Jan 28 | 3750 | 68 | 255000 |
2500 3750 |
60 68 |
150000 255000 |
|||
Jan 30 | 1250 | 68 |
85000 |
2500 2500 |
60 68 |
150000 170000 |
|||
Feb 5 | 500 | 68 | 34000 |
2500 2000 |
60 68 |
150000 136000 |
|||
Feb 10 | 18000 | 70 | 1260000 |
2500 2000 18000 |
60 68 70 |
150000 136000 1260000 |
|||
Feb 16 | 9000 | 70 | 630000 |
2500 2000 9000 |
60 68 70 |
150000 136000 630000 |
|||
Feb 28 | 8500 | 70 | 595000 |
2500 2000 500 |
60 68 70 |
150000 136000 35000 |
|||
Mar 5 | 15000 | 71.60 | 1074000 |
2500 2000 500 15000 |
60 68 70 71.60 |
150000 136000 35000 1074000 |
|||
Mar 14 | 10000 | 71.60 | 716000 |
2500 2000 500 5000 |
60 68 70 71.60 |
150000 136000 35000 358000 |
|||
Mar 25 | 2500 | 72 | 180000 |
2500 2000 500 5000 2500 |
60 68 70 71.60 72 |
150000 136000 35000 358000 180000 |
|||
Mar 30 |
2500 5000 500 1250 |
72 71.60 70 68 |
180000 358000 35000 85000 |
2500 750 |
60 68 |
150000 51000 |
|||
Balance | 2973000 | 201000 |
2) Total sales = 5191250
Cost of merchandise sold = 2973000
Gross profit = 2218250
3) Ending inventory = 201000