Question
1. Determine the costs assigned to ending inventory and to cost of goods sold using FIFO. 2. Determine the costs assigned to ending inventory and
| 1. Determine the costs assigned to ending inventory and to cost of goods sold using FIFO. 2. Determine the costs assigned to ending inventory and to cost of goods sold using LIFO. 3. Compute the gross margin for FIFO method. 4. Compute the gross margin for LIFO method.
Hemming Co. reported the following current-year purchases and sales for its only product. |
| Date | Activities | Units Acquired at Cost | Units Sold at Retail | |||||||||||||
| Jan. | 1 | Beginning inventory | 150 | units | @ $12.00 | = | $ | 1,800 | ||||||||
| Jan. | 10 | Sales | 140 | units | @ $42.00 | |||||||||||
| Mar. | 14 | Purchase | 300 | units | @ $17.00 | = | 5,100 | |||||||||
| Mar. | 15 | Sales | 190 | units | @ $42.00 | |||||||||||
| July | 30 | Purchase | 450 | units | @ $22.00 | = | 9,900 | |||||||||
| Oct. | 5 | Sales | 250 | units | @ $42.00 | |||||||||||
| Oct. | 26 | Purchase | 650 | units | @ $27.00 | = | 17,550 | |||||||||
| Totals | 1,550 | units | $ | 34,350 | 580 | units | ||||||||||
Required:
| Hemming uses a perpetual inventory system.
|
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Auditing A Risk Based Approach
Authors: Karla M Johnstone-Zehms, Audrey A. Gramling, Larry E. Rittenberg
12th Edition
035772187X, 978-0357721872
