Question

HKUST Inc. made the following transactions:

1. Jan 1^st, 2019: HKUST Inc. receives 1200 metal plates for which it pays cash of $5 each from Metal Inc. and receives 6000 plastic slabs from Plastic Inc. for which it pays $1 to the supplier in cash.
2. Jan 21^st, 2019: HKUST Inc. receives 600 metal plates for which it pays cash of $6 each from Metal Inc. and receives 3000 plastic slabs from Plastic Inc. for which it pays $2 each to the supplier in cash.
3. Jan 28^th, 2019: HKUST Inc. produces 25,000 screwdrivers and uses 1,300 metal plates and 7,500 plastic slabs to make those screwdrivers.
4. Jan 30^th, 2019: HKUST Inc. spends $5,000 cash on packaging its 25,000 screwdrivers.
5. Jan 31^st, 2019:   HKUST Inc. sells 18,000 screwdrivers to Wan Chai Inc. for $10 each. However, Wan Chai Inc. uses a Hong Kong Express credit card, which had fees of 3%, and HKUST Inc. receives the money in cash immediately from Hong Kong Express.

Prepare Extracted Balance sheet, cash flow statement, and income statement under weighted average method

Answer 1

ANSWER

working
1-Jan	Units	Cost	Total cost
Metal plates	1200	5	6000
Plastic slabs	6000	1	6000	12000
21-Jan
Metal plates	600	6	3600
Plastic slabs	3000	2	6000	9600
		used	Ending Inventory	FIFO cost	Weighted average
Total Metal plates	1800	1300	500	3000	2667
				(500*6)	(6000+3600)/1800*500
Total Plastic slabs	9000	7500	1500	3000	2000
			Total	(1500*2)	(6000+6000)/9000*1500
		FIFO		6000	4667
Cost of good sold
Metal plates (1200*5)+(100*6)		6600
Plastic slabs (6000*1)+(1500*2)		9000
		15600
		weighted average
Metal plates
(6000+3600)/1800*1300		6933
Plastic slabs
(6000+6000)/9000*7500		10000
		16933
ans 1 FIFO
Income statement
Sales (18000*10)	180000
Less: cost of good sold	15600
Gross profit	164400
Less: Packaging cost	5000
Less: credit card expenses	5400
Net Income	154000
Balance Sheet
Cash (180000*97%)-5000	169600
Inventory	6000
Total assets	175600
Accounts payable (12000+9600)	21600
Retained Earnings	154000
Total liabilities & stockholder equity	175600
Cash flow statement
Cash flow from operating activities
Collection from sales	174600
Paid pakaging expenses	-5000
Ending balance of cash	169600
weighted average
Income statement
Sales (18000*10)	180000
Less: cost of good sold	16933
Gross profit	163067
Less: Packaging cost	5000
Less: credit card expenses	5400
Net Income	152667
Balance Sheet
Cash (180000*97%)-5000	169600
Inventory	4667
Total assets	174267
Accounts payable (12000+9600)	21600
Retained Earnings	152667
Total liabilities & stockholder equity	174267
Cash flow statement
Cash flow from operating activities
Collection from sales	174600
Paid packaging expenses	-5000
Ending balance of cash	169600

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