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

The beginning inventory of merchandise 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 25 $1,200 $30,000
8 Purchase 75 1,240 93,000
11 Sale 40 2,000 80,000
30 Sale 30 2,000 60,000
May 8 Purchase 60 1,260 75,600
10 Sale 50 2,000 100,000
19 Sale 20 2,000 40,000
28 Purchase 80 1,260 100,800
June 5 Sale 40 2,250 90,000
16 Sale 25 2,250 56,250
21 Purchase 35 1,264 44,240
28 Sale 44 2,250 99,000

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 Merchandise Sold Unit Cost column and in the Inventory Unit Cost column.

Dunne Co. Schedule of Cost of Merchandise Sold FIFO Method For a Three-Month Period
Purchases Cost of Merchandise Sold Inventory
Date Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost
Apr. 3 fill in the blank 1 $fill in the blank 2 $fill in the blank 3
Apr. 8 fill in the blank 4 $fill in the blank 5 $fill in the blank 6 fill in the blank 7 fill in the blank 8 fill in the blank 9
fill in the blank 10 fill in the blank 11 fill in the blank 12
Apr. 11 fill in the blank 13 $fill in the blank 14 $fill in the blank 15
fill in the blank 16 fill in the blank 17 fill in the blank 18 fill in the blank 19 fill in the blank 20 fill in the blank 21
Apr. 30 fill in the blank 22 fill in the blank 23 fill in the blank 24 fill in the blank 25 fill in the blank 26 fill in the blank 27
May 8 fill in the blank 28 fill in the blank 29 fill in the blank 30 fill in the blank 31 fill in the blank 32 fill in the blank 33
fill in the blank 34 fill in the blank 35 fill in the blank 36
May 10 fill in the blank 37 fill in the blank 38 fill in the blank 39
fill in the blank 40 fill in the blank 41 fill in the blank 42 fill in the blank 43 fill in the blank 44 fill in the blank 45
May 19 fill in the blank 46 fill in the blank 47 fill in the blank 48 fill in the blank 49 fill in the blank 50 fill in the blank 51
May 28 fill in the blank 52 fill in the blank 53 fill in the blank 54 fill in the blank 55 fill in the blank 56 fill in the blank 57
fill in the blank 58 fill in the blank 59 fill in the blank 60
June 5 fill in the blank 61 fill in the blank 62 fill in the blank 63
fill in the blank 64 fill in the blank 65 fill in the blank 66 fill in the blank 67 fill in the blank 68 fill in the blank 69
June 16 fill in the blank 70 fill in the blank 71 fill in the blank 72 fill in the blank 73 fill in the blank 74 fill in the blank 75
June 21 fill in the blank 76 fill in the blank 77 fill in the blank 78 fill in the blank 79 fill in the blank 80 fill in the blank 81
fill in the blank 82 fill in the blank 83 fill in the blank 84
June 28 fill in the blank 85 fill in the blank 86 fill in the blank 87
fill in the blank 88 fill in the blank 89 fill in the blank 90 fill in the blank 91 fill in the blank 92 fill in the blank 93
June 30 Balances $fill in the blank 94 $fill in the blank 95

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

Record sale

Accounts Payable, Accounts Receivable, Cash, Merchandise Inventory, Sales

fill in the blank 97

Accounts Payable, Accounts Receivable, Cash, Cost of Merchandise Sold, Sales

fill in the blank 99
Record cost

Accounts Payable, Cash, Cost of Merchandise Sold, Merchandise Inventory, Sales

fill in the blank 101

Accounts Payable,Accounts Receivable,Cash,Cost of Merchandise Sold, Merchandise Inventory

fill in the blank 103

3. Determine the gross profit from sales for the period. $fill in the blank

4. Determine the ending inventory cost on June 30. $fill in the blank

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

Higher or Lower

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