Question

Iron R Us began August with 65 units of bronventory that cost $30 each. During August, the company completed the lowing inventory transactions 110 (Click the icon to view the transactions) Read the requirements Requirement 1. Prepare a perpetual ventory record for the merchandise inventory using the FIFO Inventory costing method Start by entering the beginning inventory balances Enter the transactions in chronological order, calculating new Inventory on hand balances after each transaction Once perpetual record, calculate the quantity and total cost of merchandise inventory purchased sold and on hand at the end of the period (Enter the oldest ventory layers of the ansaction Purchases Cost of Goods Sold Inventory on Hand De Total Cost Total Cost Quantity Cost Cost Quantity Cost Quantity Cost Enter any number in the edit Delds and then check Answer CAS

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
	Aug, 01	Beginning inventory							65	$         30.00	$1,950
	Aug, 03	Sales				50	$             30.00	$1,500	15	$         30.00	$450
	Aug, 08	Purchases	85	$             50.00	$4,250				15	$         30.00	$450
									85	$         50.00	$4,250
	Aug, 21	Sales				15	$             30.00	$450
						65	$             50.00	$3,250	20	$         50.00	$1,000
	Jan, 30	Purchases	20	$             45.00	$900				20	$         50.00	$1,000
									20	$         45.00	$900
			105		$5,150	130		$5,200	40		$1,900
SOLUTION : 2
	LIFO - PERPETUAL METHOD
			PURHASES			COST OF GOODS SOLD			ENDING INVENTORY
	Date	Particulars	Units	Rate	Total	Units	Rate	Total	Units	Rate	Total
	Aug, 01	Beginning inventory							65	$         30.00	$1,950
	Aug, 03	Sales				50	$             30.00	$1,500	15	$         30.00	$450
	Aug, 08	Purchases	85	$             50.00	$4,250				15	$         30.00	$450
									85	$         50.00	$4,250
	Aug, 21	Sales				80	$             50.00	$4,000	15	$         30.00	$450
									5	$         50.00	$250
	Jan, 30	Purchases	20	$             45.00	$900				15	$         30.00	$450
									5	$         50.00	$250
									20	$         45.00	$900
			105		$5,150	130		$5,500	40		$1,600
SOLUTION : 3
	WEIGHTED AVERAGE METHOD
			PURHASES			COST OF GOODS SOLD			ENDING INVENTORY
	Date	Particulars	Units	Rate	Total	Units	Rate	Total	Units	Rate	Total
	Aug, 01	Beginning inventory							65	$         30.00	$1,950
	Aug, 03	Sales				50	$             30.00	$1,500	15	$         30.00	$450
	Aug, 08	Purchases	85	$             50.00	$4,250				100	$         47.00	$4,700
	Aug, 21	Sales				80	$             47.00	$3,760	20	$         47.00	$940
	Jan, 30	Purchases	20	$             45.00	$900				40	$         46.00	$1,840
			105		$5,150	130		$5,260	40		$1,840
SOLUTION = 4
			FIFO	LIFO	WEIGH. AVG METHOD
		Cost of Goods Sold	$5,200	$5,500	$5,260
SOLUTION = 5		CALCULATION OF GROSS PROFIT
		Sales Revenue (50 Units X $ 81) + (80 X $ 75)	$10,050	$10,050	$10,050
		Less : Cost of Good Sold	$5,200	$5,500	$5,260
		Gross Profit	$4,850	$4,550	$4,790
SOLUTION = 6
		For Maximise gross profit FIFO method will be used