Problem 6-9A
Required
1. How many units did Winslow Products sell during the year? The sale price per unit was
$38. Determine Winslow's sales revenue for the year.
2. Compute cost of goods sold by the weighted-average method. Round average cost per
unit to the nearest cent and all other amounts to the nearest dollar. Then determine gross
margin for the year.
3. Compute cost of goods sold by the FIFO method. Then determine gross margin for the
year.
4. Compare the gross margins you calculated for each inventory method in Requirements
2 and 3. What conclusions can you draw when the purchase prices for inventory are
falling?
CT) {43 Required 1. Miake summary journal entries to record the company's transactions for the year ended December 31, 2017. The company uses a perpetual inventory system. . Determine the FIFO cost of the company's ending inventory at December 31, 2017. Use a Taccount. . Calculate Prairie Hardware's gross margin for the year ended December 31, 2017. Problem 68A Fast Framing Co. began March with 73 units of inventory that cost $50 each. During the Computing inventory bytwo month, Fast made the following purd'rases: me'lliDdSDEI'iOdiC $151601 6) Mar. 4 113 units at $48 2. @055 margin, weighted 12 31 units at $49 average. $i8,942 19 167 units at $52 25 34 units at $56 The company uses a periodic inventory system, and the physical count at March 31 shows 51 units of inventory on hand. Required 1. Determine the ending inventory and cost of goods sold amounE for the March financial statements under (a) weightediaverage cost and (b) FIFO cost. Round average cost per unit to the nearest cent and all other amounts to the nearest dollar. . Sales revenue for March totalled $40M. Compute Fast's gross margin for hiarch under each method. . Which method will result in lower income taxes for Fast? Why? . W'l'iicl'i method will result in higher net income for Fast? Why? Problem 69A Winslow Products, which uses a periodic inventory system, began 2017 with 6,000 units of Using the periodi( inventory inventory that cost a total of $9U,lIlll. During 2017, Winslow Products purchased merchana SlHQWIwalghmd'averagi' and dise on account as follows: FIFO costing 3. Gross margin, FIFO. 5378.000 Purchase 1 (10,000 units at $14 per unit) $140,000 Purchase 2 (20,003 units at $12 per unit) 240,030 At year end, the physical count indicated 20,000 units of inventory on hand. Required 1. How many units did Winslow Products sell during the year? The sale price per unit was $33. Determine Winslow's sales revenue for the year. . Compute cost of goods sold by the weighted-average method. Round average cost per unit to the nearest cent and all other amounts to the nearest dollar. Then determine gross margin for the year. . Compute cost of goods sold by the FIFO method. Then determine gross margin for the year. . Compare the gross margins you calculated for each inventory method in Requirements 2 and 3. What conclusions can you draw when the purchase prices for inventory are falling? Chapter 6 Accounting for Merchandise Inventory 361 Problem 61 M Using the perpetual and periodic Titan Performance Tire began May with 50 units of inventory that cost $264 each. During inventory SYSTEWS May Titan Performance Tire completed these inventory transactions: (96) 3. Gross margin. $8,200 Unite Unit Cost Unit Selling Price May 2 12 $270 8 27 264 $360 13 23 264 360 3 270 17 24 270 22 31 270 29 24 290 Required 1. The above data are taken from Tltan Performance Tire's perpetual inventory records. Which cost method does Tltan Performance Tire use? 2. Compute Titan Performance Tire's cost ot goods sold for May under the a. Perpetual inventory system b. Periodic inventory system . Compute gross margin for May. 3.51] it 11m in
