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Jillet Corporation began the year with inventory of 1 0 , 0 0 0 units of its only product. The units cost $ 8 each.
Jillet Corporation began the year with inventory of units of its only product.
The units cost $ each. The company uses a perpetual inventory system and the
FIFO cost method. The following transactions occurred during the year:
a
Purchased additional units at a cost of $ per unit. Terms of the
purchases were The company uses the gross method to record purchase
discounts. The inventory was purchased fob shipping point and additional freight
costs of $ per unit were charged to Jillet.
b
units purchased during the year were returned to suppliers for credit. Jillet
was also given credit for the freight charges of $ per unit on the original
purchase. The units were defective and were returned two days after they were
received. The remaining inventory was paid within the discount period. Hint: The
discount applies only to inventory and not the freight.
c Sales for the year totaled units at $ per unit. Hint: The cost of the
inventory sold includes the purchase cost of those units plus freight less purchase
discount.
d On December Jillet purchased additional units at $ each. The goods
were shipped fob destination and arrived at Jillet's warehouse on January of the
following year.
e units were on hand at the end of the year.
Required:
Determine ending inventory and cost of goods sold at the end of the year.
Assuming that operating expenses other than those indicated in the above
transactions amounted to $ determine income before income taxes for the
year.
For financial reporting purposes, the company uses LIFO amounts based on a
periodic inventory system Record the yearend adjusting entry for the LIFO
reserve, assuming the balance in the LIFO reserve at the beginning of the year is
$
Determine the amount the company would report as income before taxes for the
year under LIFO. Operating expenses other than those indicated in the above
transactions amounted to $
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