Compute the cost of goods sold, cost of ending merchandise inventory using FIFO inventory costing method.
Dec. 1 Beginning merchandise inventory 8 Sale 14 Purchase 21 Sale 11 6 14 13 units @ $ 9 each units @ $ 23 each units @ $ 15 each units @ $ 23 each Print Done 1. Compute the cost of goods sold, cost of ending merchandise inventory, and gross profit using the FIFO inventory costing method. 2. Compute the cost of goods sold, cost of ending merchandise inventory, and gross profit using the LIFO inventory costing method. 3. Which method results in a higher cost of goods sold? 4. Which method results in a higher cost of ending merchandise inventory? 5. Which method results in a higher gross profit? Requirement 1. Compute the cost of goods sold, cost of ending merchandise inventory, and gross profit using the FIFO inventory costing method Begin by computing the cost of goods sold and cost of ending merchandise inventory using the FIFO inventory costing method. Enter the transactions in chronological order, calculating new inventory on hand balances after each transaction. Once all of the transactions have been entered into the perpetual record, calculate the quantity and total cost of merchandise inventory purchased, sold, and on hand at the end of the period. (Enter the oldest inventory layers first.) Purchases Unit Cost Total Cost of Goods Sold Unit Quantity Cost Cost Total Inventory on Hand Unit Quantity Cost Total Quantity Cost Date Dec. 1 Dec. 8 Dec. 14 14 15 Dec. 21 Totals Requirement 2. Compute the cost of goods sold, cost of ending merchandise inventory, and gross profit using the LIFO inventory costing method. Begin by computing the cost of goods sold and cost of ending merchandise inventory using the LIFO inventory costing method. Enter the transactions in chronological order, calculating new inventory on hand balances after each transaction. Once all of the transactions have been entered into the perpetual record, calculate the quantity and total cost of merchandise inventory purchased, sold, and on hand at the end of the period. (Enter the oldest inventory layers first.) Purchases Unit Cost Total Cost Total Cost of Goods Sold Unit Quantity Cost Cost Inventory on Hand Unit Total Quantity Cost Cost Quantity Date Dec. 1 Dec. 8 Dec. 14 Dec. 21 Totals Compute the gross profit using the using the LIFO inventory costing method. Gross profit is $ U u sing the LIFO inventory costing method. Requirement 3. Which method results in a higher cost of goods sold? The method with the higher cost of goods sold is Requirement 4. Which method results in a higher cost of ending merchandise inventory? The method with the higher cost of ending merchandise inventory is Requirement 5. Which method results in a higher gross profit? The method with the higher gross profit is
