Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I'm pretty sure I was doing it right but got stuck. Problem 6-4AA (Algo) Periodic: Alternative cost flows LO P3 Montoure Company uses a periodic

image text in transcribed

image text in transcribed

image text in transcribed

I'm pretty sure I was doing it right but got stuck.

Problem 6-4AA (Algo) Periodic: Alternative cost flows LO P3 Montoure Company uses a periodic inventory system. It entered into the following calendar-year purchases and sales transactions. Units Sold at Retail ATM Units Acquired at "Cost 625 units @ $45.00 per unit 450 units @ $42.00 per unit 225 units @ $27.00 per unit Date January 1 February 10 March 13 March 15 August 21 September 5 September 10 Activities Beginning inventory Purchase Purchase Sales Purchase Purchase Sales Totals 900 units @ $75.00 per unit 125 units 525 units @ $50.00 per unit @ $46.00 per unit @ $75.00 per unit 650 units 1,550 units 1,950 units Required: 1. Compute cost of goods available for sale and the number of units available for sale. 83,500 Cost of goods available for sale Number of units available for sale 1,950 units 2 Compute the number of units in ending inventory. Ending inventory 400 units 3. Compute the cost assigned to ending inventory using (a) FIFO, (6) LIFO, (c) weighted average, and (d) specific identification. For specific identification, units sold consist of 625 units from beginning inventory, 325 from the February 10 purchase, 225 from the March 13 purchase, 75 from the August 21 purchase, and 300 from the September 5 purchase. (Round your average cost per unit to 2 decimal places. Round your final answers to the nearest whole dollar amount.) Ending Inventory (a) FIFO (b) LIFO (C) Weighted average (d) Specific identification 4. Compute gross profit eamed by the company for each of the four costing methods. (Round your average cost per unit to 2 decimal places. Round your final answers to the nearest whole dollar amount.) k FIFO LIFO Weighted Average Specific Identification ces Sales Less Cost of goods sold Gross profit $ 0 $ 0 $ ols 0 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? Specific identification Weighted Average FIFO LIFO

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Economics Of Accounting Information In Markets

Authors: Peter Ove Christensen, Gerald Feltham

2nd Edition

1402072295, 9781402072291

More Books

Students also viewed these Accounting questions

Question

The symbol Answered: 1 week ago

Answered: 1 week ago