Question

Saved Help Save & Exit Su Check my wc Required information [The following information applies to the questions displayed below.) Hemming Co. reported the following current-year purchases and sales for its only product. Date Activities Jan. 1 Beginning inventory Jan. 10 Sales Mar. 14 Purchase Mar.15 Sales July 30 Purchase Oct. 5 Sales Oct.26 Purchase Totals Units Acquired at Cost 230 units @ $11.20 = $ 2,576 350 units @ $16.20 = 5,670 430 units @ $21.20 - 9,116 130 units @ $26.20 – 3,406 1,140 units $20,768 Units Sold at Retail 160 units @ $41.20 320 units @ $41.20 400 units @ $41.20 880 units Required: Hemming uses a perpetual inventory system. Assume that ending Inventory is made up of 50 units from the March 14 purchase, 80 units from the July 30 purchase, and all 130 units from the October 26 purchase. Using the specific identification method, calculate the following a) Cost of Goods Sold using Specific Identification < Prev of 5 6 Next >

Answer 1

Answer is given below

a) Cost of Goods sold using Specific identification method Available for Sale Cost of Goods sold Date Activity Units Unit cost Ending inventory Ending Ending inventory Unit Cost inventory Units Cost Units sold Unit Cost COGS 230 300 Jan 1 Mar 14 July 30 Oct 26 Beginning inventory Purchases Purchase Purchase 50 230 350 430 130 $11.20 $16.20 $21.20 $26.20 $11.20 $16.20 $21.20 $2,576 $4,860 $7,420 350 80 $16.20 $21.20 $26.20 $810 $1,696 $3,406 130 1,140 $14,856 260 $5,912 b) Gross margin using specific identification Sales $36,256 Cost of Goods sold $14,856 Gross Margin $21,400 Sales Jan 10 Mar 15 Oct 5 Total Sales Units price Total 160 $41.20 $6,592 320 $41.20 $13,184 400 $41.20 $16,480 8801 $36,256