Question

Assume that J L Toys store bought and sold a line of dolls during December as follows Click the icon to view the transactions) JL Toys uses the perpetual inventory system est Read the requirements chronological order, caiculating new inventory on hand balances atter each transaction. Unce all of the transactions nave been entered into the perpetual recora calculate the quantity and total cost of merchandise inventory purchased, sold, and on hand at the end of the period. (Enter the oldest inventory layers first) Purchases Cost of Goods Sold Inventory on Hand Unit Total Unit Total Unit Total Date Quantity Cost Cost Quantity Cost Cost Quantity Cost Cost Dec. 1 Dec. 8 Dec. 14 Dec 21 Enter any number in the edit fields and then continue to the next question This course (BA211 Fall 2019 Matousek) is based on Nobles: Horngren's Financial & Managerial Accounting Financial Chapters, 6e e

Answer 1

SOLUTION : 1
	FIFO - PERPETUAL METHOD
			PURHASES			COST OF GOODS SOLD			ENDING INVENTORY
	Date	Particulars	Units	Rate	Total	Units	Rate	Total	Units	Rate	Total
	Dec, 01	Beginning inventory							13	$         11.00	$143
	Dec, 08	Sales				9	$             24.00	$216	4	$         11.00	$44
	Dec, 14	Purchases	17	$             15.00	$255				4	$         11.00	$44
									17	$         15.00	$255
	Dec, 21	Sales				4	$             11.00	$44
						10	$             15.00	$150	7	$         15.00	$105
			17		$255	23		$410	7		$105
SOLUTION : 2
	LIFO - PERPETUAL METHOD
			PURHASES			COST OF GOODS SOLD			ENDING INVENTORY
	Date	Particulars	Units	Rate	Total	Units	Rate	Total	Units	Rate	Total
	Dec, 01	Beginning inventory							13	$         11.00	$143
	Dec, 08	Sales				9	$             24.00	$216	4	$         11.00	$44
	Dec, 14	Purchases	17	$             15.00	$255				4	$         11.00	$44
									17	$         15.00	$255
	Dec, 21	Sales				14	$             15.00	$210	4	$         11.00	$44
									3	$         15.00	$45
			17		$255	23		$426	7		$89
SOLUTION = 3
		Higher Cost of Goods sold as per LIFO basis
		Answer = LIFO
SOLUTION = 4
		Higher merchandise inventory is on basis of LIFO basi
		Answer = FIFO
SOLUTION = 5		CALCULATION OF GROSS PROFIT
			FIFO	LIFO
		Sales Revenue (23 Units X $ 24 )	$552	$552
		Less : Cost of Good Sold	$410	$426
		Gross Profit	$142	$126
		Highest Gross profit is generated with FIFO basis
		Answer = FIFO