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IFO Perpetual Inventory The beginning inventory at Dunne Co. and data on purchases and sales for a three-month period ending June 30 are as follows:

IFO Perpetual Inventory

The beginning inventory at Dunne Co. and data on purchases and sales for a three-month period ending June 30 are as follows:

Date Transaction Number of Units Per Unit Total
Apr. 3 Inventory 42 $300 $12,600
8 Purchase 84 360 30,240
11 Sale 56 1,000 56,000
30 Sale 35 1,000 35,000
May 8 Purchase 70 400 28,000
10 Sale 42 1,000 42,000
19 Sale 21 1,000 21,000
28 Purchase 70 440 30,800
June 5 Sale 42 1,050 44,100
16 Sale 56 1,050 58,800
21 Purchase 126 480 60,480
28 Sale 63 1,050 66,150

Required:

1. Record the inventory, purchases, and cost of merchandise sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the first-in, first-out method. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Goods Sold Unit Cost column and in the Inventory Unit Cost column.

Dunne Co. Schedule of Cost of Goods Sold FIFO Method For the Three Months Ended June 30
Purchases Cost of Goods Sold Inventory
Date Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost
Apr. 3 $ $
Apr. 8 $ $
Apr. 11 $ $
Apr. 30
May 8
May 10
May 19
May 28
June 5
June 16
June 21
June 28
June 30 Balances $ $

2. Determine the total sales and the total cost of goods sold for the period. Journalize the entries in the sales and cost of goods sold accounts. Assume that all sales were on account.

Record sale
Record cost

3. Determine the gross profit from sales for the period. $

4. Determine the ending inventory cost as of June 30. $

5. Based upon the preceding data, would you expect the ending inventory using the last-in, first-out method to be higher or lower?

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