Question
You have the following information for Splish Brothers Inc.. Splish Brothers Inc. uses the periodic method of accounting for its inventory transactions. Splish Brothers Inc.
You have the following information for Splish Brothers Inc.. Splish Brothers Inc. uses the periodic method of accounting for its inventory transactions. Splish Brothers Inc. only carries one brand and size of diamondsall are identical. Each batch of diamonds purchased is carefully coded and marked with its purchase cost.
| March 1 | Beginning inventory 157 diamonds at a cost of $317 per diamond. | |
| March 3 | Purchased 219 diamonds at a cost of $364 each. | |
| March 5 | Sold 166 diamonds for $607 each. | |
| March 10 | Purchased 298 diamonds at a cost of $403 each. | |
| March 25 | Sold 414 diamonds for $588 each. |
Assume that Splish Brothers Inc. uses the LIFO cost flow assumption. Calculate cost of goods sold. How much gross profit would the company report under this cost flow assumption?
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Managerial Accounting Tools for business decision making
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
6th Edition
978-1118096895
