Question

Question Help Assume that JR Toys store bought and sold a line of dolls during December as follows: Click the icon to view the transactions) JR Toys uses the perpetual inventory system, Read the requirements Requirement 1. Compute the cost of goods sold cost ofending mechandise ry and gros proting the FIFO inventory costing method Begin by computing the cost of goods sold and cost of ending merchandise inventory using the FFO inventory outing method Enter the transactions in chronological order, calculating row inventory on hand balances after each transaction. Once all of the transactions have been entered into the perpetual record clue the quantity and total of merchandise Inventor purchased sod, and on hand at the end of the period Enter the oldest inventory layers first.) Purchases Cost of Goods Sold ventory on Hand Total Unit Cost Total Cost Date Quantity Quantity Cost Cost Quantity Dec. 11 Decal Dee Enter any number in the ed fields and then click Check Answer Clear Check Answer 6 aning

Answer 1

Solution 1. Computation of Cost of Goods sold and Cost of ending Inventory - FIFO method Purchases Cost of Goods sold Inventory on Hand Date Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost Dec 01 12 $ 9 $ 108 Dec 08 7 $ 9 $ 63 5 $ 9 $ 45 Dec 14 17 $ 13$ 221 5 $ 9 $ 45 17 $ 13 $ 221 Dec 21 5 $ 9 $ 45 11 $ 13 $ 143 6 $ 13 $ 78 Total cost of Goods sold : 23 $ 251 Cost of Ending Inventory : 6 $ 13 $ 78 168 Total Sales : 7 units x $24 $ 16 units x $24 $ 384 less: Cost of Goods sold Gross Profit $ $ 552 251 301 Solution 2. Computation of Cost of Goods sold and Cost of ending Inventory - LIFO method Purchases Cost of Goods sold Date Inventory on Hand Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost Dec 01 12 $ 9 $ 108 Dec 08 7 $ 9 $ 63 5 $ 9 $ 45 Dec 14 17 $ 13$ 221 17 $ 13$ 221 5 $ 9 $ 45 Dec 21 16 $ 13 $ 208 1 $ 13 $ 13 5 $ 9 $ 45 Total cost of Goods sold : 23 $ 271 6 $ 58 Cost of Ending Inventory : C6 $ 58 Total Sales : 7 units x $24 $ 16 units x $24 $ 168 384 552 271 281 less: Cost of Goods sold Gross Profit $ $

Solution 3. Which method results in a Higher cost of Goods sold Amount of Cost of Goods sold LIFO 271 $ Solution 4. Method with higher cost of Inventory Cost of Inventory (FIFO) Solution 5. Method having higher gross profit Amount of Gross profit

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