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 Jan. 7 Feb. 16 March 22 Units 3,000 11,000 15,000 29,000 Unit Cost $3.00 4.00 5.00 Total Cost $ 9,000 44,000 75,000 $ 128,000 Totals Sales for the quarter, all at $8 per unit, totaled 17,000 units leaving 12,000 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. Req 1A Reg 1B Req 1C Req 2 Reg 3 Calculate Topanga's cost of goods sold for the first quarter using FIFO. FIFO: Cost of Goods Available for Sale Cost of Goods Sold - Periodic FIFO Cost of Goods # of units Cost per Cost per Cost of # of units Available for unit sold unit Sale $ 0.00 $ 0 Goods Sold in ending Ending Inventory - Periodic FIFO # of units Cost per Ending unit Inventory inventory $ 0.00 $ 0 0 0 3.00 0 $ 0 Beginning Inventory Purchases: January 7 February 16 March 22 Total $ $ 4.00 0 $ 3,000 $ 3.00 11,000 $ 4.00 15,000 $ 5.00 29,000 0 9,000 44,000 75,000 128,000 3.00 4.00 5.00 $ 5.00 0 $ 0 0 $ 0 $ 0 0 $ 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 Jan. 7 Feb. 16 March 22 Totals Units 3,000 11,000 15,000 29,000 Unit Cost $3.00 4.00 5.00 Total Cost $ 9,000 44,000 75,000 $ 128,000 Sales for the quarter, all at $8 per unit, totaled 17,000 units leaving 12,000 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. Req 1A Req 1B Req 1C Reg 2 Req3 Calculate Topanga's cost of goods sold for the first quarter using LIFO. Cost of Goods Sold - Periodic LIFO LIFO Cost of Goods Available for Sale Cost of Goods # of units Cost per Available for unit Sale $ 0 # of units sold Cost per unit Cost of Goods Sold Ending Inventory - Periodic LIFO # of units Cost per in ending Ending unit inventory $ 0.00 $ Inventory $ 0.00 $ 0 0 0 S 3.00 S 0 Beginning Inventory Purchases: January 7 February 16 March 22 Total 0 ol S S 3,000 $ 3.00 11,000 $ 4.00 15,000 $ 5.00 29,000 0 9,000 44,000 75,000 128,000 3.00 4.00 5.00 4.00 5.00 $ S 0 0 0 0 $ 0 $ 0 $ 0 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 Jan. 7 Feb. 16 March 22 Units 3,000 11,000 15,000 29,000 Unit Cost $3.00 4.00 5.00 Total Cost $ 9,000 44,000 75,000 $ 128,000 Totals Sales for the quarter, all at $8 per unit, totaled 17,000 units leaving 12,000 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 Req 1C 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.) Average Cost Cost of Goods Available for Sale Cost of Goods Unit # of units Available for Cost Sale Cost of Goods Sold - Average Cost # of units Average Cost of Cost per sold Unit Ending Inventory - Average Cost # of units Average Cost per Ending Inventory inventory unit Goods Sold in ending $ Beginning Inventory Purchases: January 7 February 16 March 22 Total 3,000 $ 3.00 11,000 $ 4.00 15,000 $ 5.00 29,000 9,000 44,000 75,000 128,000 $ $ 0 $ 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 0 + 0 LIFO Average cost + 0 Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 1C Reg 2 Req3 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.
