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Posted on Sep 06, 2024

Topanga Group began operations early in 2021. Inventory purchase Information for the quarter ended March 31, 2021, for Topanga's only product is provided below. The

Topanga Group began operations early in 2021. Inventory purchase Information for the quarter ended March 31, 2021, for Topanga's only product is provided below. The unit costs Include the cost of freight. The company uses a periodic Inventory system to report Inventory and cost of goods sold. Date of Purchase Units Unit Cost Total cost $ 36,000 125, eee 174,000 $335,000 Jan. 7 Feb. 16 March 22 Totals 9, eee 25, eee 29,000 63,000 $4.00 5.ee 6.00 Sales for the quarter, all at $9 per unit, totaled 36,000 units leaving 27.000 units on hand at the end of the quarter. Required: 1. Calculate Topanga's cost of goods sold for the first quarter using: a. FIFO b. LIFO C. Average cost 2. Calculate Topanga's gross profit ratio for the first quarter using FIFO, LIFO, and Average cost. 3. Comment on the relative effect of each of the three Inventory methods on the gross profit ratio. Complete this question by entering your answers in the tabs below. Reg 1A Reg 1B Reg 10 Reg 2 Reg 3 Calculate Topanga's cost of goods sold for the first quarter using FIFO. Cost of Goods Available for Sale Cost of Goods Sold - Periodic FIFO FIFO: Cost of Goods Cost per # of units # of units Available for unit unit Goods Sold Cost per Cost of Ending Inventory - Periodic FIFO # of units Cost per Ending in ending unit inventory Inventory S 0.00 Sale sold 0 S 0.00 Beginning inventory Purchases: January 7 February 18 March 22 9,000 $ 4.00 38.000 4.00 S 4.00 663 5.00 25,000 29,000 63.000 $ 5.00 $ 8.00 125.000 174,000 335.000 5.00 8.00 S 8.00 S Total S Required: 1. Calculate Topanga's cost of goods sold for the first quarter using: a. FIFO b. LIFO c. Average cost 2. Calculate Topanga's gross profit ratio for the first quarter using FIFO, LIFO, and Average cost. 3. Comment on the relative effect of each of the three Inventory methods on the gross profit ratio. Complete this question by entering your answers in the tabs below. Reg 1A Reg 1B Reg 10 Reg 2 Req3 Calculate Topanga's cost of goods sold for the first quarter using LIFO. Cost of Goods Available for Sale Cost of Goods Sold - Periodic LIFO LIFO Cost of Goods Cost per # of units # of units Cost per Available for unit Cost of Goods Sold Ending Inventory - Periodic LIFO # of units Cost per in ending Ending unit inventory Inventory $ 0.00 unit sold Sale $ 0 s 0.00 9,000 03 S 4.00 Beginning Inventory Purchases: January 7 February 16 March 22 Total $ 4.00 $5.00 $ 0.00 4.00 5.00 S 25,000 29.000 63,000 S 36,000 125,000 174,000 335,000 5.00 6.00 S 6.00 $ S Required: 1. Calculate Topanga's cost of goods sold for the first quarter using: a. FIFO b. LIFO c. Average cost 2. Calculate Topanga's gross profit ratio for the first quarter using FIFO, LIFO, and Average cost. 3. Comment on the relative effect of each of the three Inventory methods on the gross profit ratio. Complete this question by entering your answers in the tabs below. Req 1A Reg 1B Reg 10 Reg 2 Reg 3 Calculate Topanga's cost of goods sold for the first quarter using average cost. (Round average cost per unit to 4 decimal places.) Cost of Goods Available for Sale Cost of Goods Sold - Average Cost Ending Inventory - Average Cost Average Cost Cost of Goods Average # of units Average Unit # of units # of units Cost of Available for Cost per Cost Ending Cost per Sale sold in ending Unit Goods Sold inventory unit Inventory Beginning inventory Purchases: January 7 9,000 $ 4.00 36,000 February 10 25,000 $ 5.00 125,000 March 22 29.000 $ 0.00 174,000 Total 63,000 S 335,000 2. Calculate Topanga's gross profit ratio for the first quarter using FIFO, LIFO, and Average cost. 3. Comment on the relative effect of each of the three Inventory methods on the gross profit ratio. Complete this question by entering your answers in the tabs below. Req 1A Reg 1B Req 1C Req 2 Reg 3 Calculate Topanga's gross profit ratio for the first quarter using FIFO, LIFO, and Average cost. Choose Numerator: = Choose Denominator: Gross Profit Ratio Gross profit ratio FIFO 1111111 LIFO Average cost Sales for the quarter, all at $9 per unit, totaled 36,000 units leaving 27,000 units on hand at the end of the quarter. Required: 1. Calculate Topanga's cost of goods sold for the first quarter using: a. FIFO b. LIFO c. Average cost 2. Calculate Topanga's gross profit ratio for the first quarter using FIFO, LIFO, and Average cost 3. Comment on the relative effect of each of the three Inventory methods on the gross profit ratio. Complete this question by entering your answers in the tabs below. Reg 1A Reg 18 Reg 10 Reg 2 Reg 3 Comment on the relative effect of each of the three inventory methods on the gross profit ratio. In situations when costs are rising. LIFO results in a cost of goods sold and therefore, a gross profit ratio than FIFO.