Information for Churchill Company is presented in P6-3A. Assume the same inventory data and that the company
Question:
Information for Churchill Company is presented in P6-3A.
.png)
Assume the same inventory data and that the company uses a perpetual inventory system. Ignore the inventory shortage in P6-3A part (d).
Instructions
(a) Calculate the cost of goods sold and the ending inventory using weighted average. (Round the weighted aver- age cost per unit to two decimal places.)
(b) Prepare the journal entry to record the November 15 sale.
(c) If the company changes from weighted average to FIFO and prices continue to fall, would you expect the cost of goods sold and ending inventory amounts to be higher or lower?
Taking It Further
If Churchill Company wishes to change from weighted average to the FIFO cost formula, what factors must it consider before making this change?
The 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:
a Weighted Average Calculations Date Purchases Cost of goods sold Inventory Balance Total WA Cost Units Cost Total Units Cost Total Units Cost Total U...View the full answer
Accounting Principles
ISBN: 978-1119048503
7th Canadian Edition Volume 1
Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Warren, Lori Novak
