Chapter $5$ Inventories

uses a perpetual inventory system. It entered into the following calendar$-$year pur$-$

Problem $5-3$A

Perpetual: Alternative cost flows Company uses a perpetual inventory system. It entered ins consist of $600$ units from beginning inves and sales transact February $10$ purchase, $200$ from the March $13$ purchase, $50$ from the August $21$ P$1$ purchase, and $250$ from the September $5$ purchase.$)$

$\backslash$table$[[$Date$,$Activities,Units Acquired at Cost,Units Sold at Retail$],[$Jan$.1,$Beginning inventory,$600$ units @ $$45$ per unit,$],[$Feb$.10,$Purchase $..........,\backslash$table$[[600$ units @$$45$ per unit$],[400$ units @$$42$ per unit$]],],[$Mar$.13,$Purchase,$200$ units @ $$27$ per unit,$],[$Mar$.15,$Sales.....,,$800$ units @$$75$ per unit$],[$Aug$.21,$Purchase,$100$ units @$$50$ per unit,$],[$Sep$.5,$Purchase,$500$ units @ $$46$ per unit,$],[$Sep$.10,$Sales.....,,$600$ units @ $$75$ per unit$],[,$Totals,$\frac{?}{\text{b}\text{a}\text{r}}(1,800$ units $),1,400$ units$]]$

Required

Compute cost of goods available for sale and the number of units available for sale.

Compute the number of units in ending inventory.

Compute the cost assigned to ending inventory using $($a$)$ FIFO, $($b$)$ LIFO, $($c$)$ weighted average, and $($d$)$ specific identification. $($Round all amounts to cents.$)$

Compute gross profit earned by the company for each of the four costing methods in part $3.$

Analysis Component

$5.$ The company's manager earns a bonus based on a percent of gross profit. Which method of inventory costing produces the highest bonus for the manager?

Refer to the information in Problem $5-3$A and assume the periodic inventory system is used.

Required

Compute cost of goods available for sale and the number of units available for sale.

Compute the number of units in ending inventory.

Compute the cost assigned to ending inventory using $($a$)$ FIFO, $($b$)$ LIFO, $($c$)$ weighted average, and $($d$)$ specific identification. $($Round all amounts to cents.$)$

Compute gross profit earned by the company for each of the four costing methods in part $3.$

Analysis Component

$5.$ The company's manager earns a bonus based on a percentage of gross profit. Which method of inventory costing produces the highest bonus for the manager?

Problem $5-4$AA

Periodic: Alternative

cost flows

P$3$