The following information relates to the inventory of Gadgets Ltd during May: May 1 3 10 12
Question:
The following information relates to the inventory of Gadgets Ltd during May:
May 1 3 10 12 17 25 | Beginning Inventory Purchased Purchased Sold Sold Sold | 80 90 110 90 80 30 | units units units units units units | @ $7 @ $8 @ $9 |
Gadgets Ltd uses a perpetual inventory system. Ignore GST.
Required
Determine the cost of the ending inventory (assuming there have been no stock losses) and the cost of sales, using the following three methods.
1. The moving average; round unit cost to the nearest cent.
2. Specific identification; assume that the ending inventory on 31 May consisted of 13 units from the beginning inventory, 24 units from the 3 May purchase, and the remainder from the 10 May purchase.
3. FIFO.
Ending InventoryThe ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...
Step by Step Answer:
Accounting
ISBN: 978-1118608227
9th edition
Authors: Lew Edwards, John Medlin, Keryn Chalmers, Andreas Hellmann, Claire Beattie, Jodie Maxfield, John Hoggett