a)
Calculation of cost of goods sold andclosing inventory under FIFO (Perpetual) | ||||||||||
TransactionType | Cost of goods sold | Closing inventory | ||||||||
Date | Particulars | Qty | Rate | Amount($) | Qty | Rate | Amount($) | Qty | Rate | Amount($) |
01-Jan | Beginning inventory | 130 | 81 | 10,530 | 130 | 81 | 10,530 | |||
05-Mar | purchase | 110 | 91 | 10,010 | 130 | 81 | 10,530 | |||
110 | 91 | 10,010 | ||||||||
10-Apr | sale | 75 | 81 | 6,075 | 55 | 81 | 4,455 | |||
110 | 91 | 10,010 | ||||||||
19-Jun | sale | 55 | 81 | 4,455 | 40 | 91 | 3,640 | |||
70 | 91 | 6,370 | ||||||||
16-Sep | purchase | 60 | 96 | 5,760 | 40 | 91 | 3,640 | |||
60 | 96 | 5,760 | ||||||||
28-Nov | sale | 40 | 91 | 12,190 | 35 | 96 | 3,360 | |||
25 | 96 | 2,775 | ||||||||
Total / Balance | 300 | 26,300 | 265 | 31,865 | 35 | 3,360.00 |
Date | Account Titles and Explanation | Debit | Credit |
Mar. 5 | Merchandise Inventory | 10,010 | |
Accounts Payable | 10,010 | ||
Apr. 10 | Accounts Receivable/Cash | 13275 | |
Sales Revenue | 13275 | ||
Apr. 10 | Cost of goods sold | 6,075 | |
Merchandise inventory | 6,075 | ||
June 19 | Accounts Receivable/Cash | 22125 | |
Sales Revenue | 22125 | ||
June 19 | Cost of goods sold | 10,825 | |
Merchandise inventory | 10,825 | ||
Sept. 16 | Merchandise Inventory | 5,760 | |
Accounts Payable | 5,760 | ||
Nov. 28 | Accounts Receivable | 11830 | |
Sales Revenue | 11830 | ||
Nov. 28 | Cost of goods sold | 14,965 | |
Merchandise inventory | 14,965 |
b)Gross Margin = 47,230 - 31,865
=15,365
c)Ending Inventory = 35 Units Value of $ 3,360
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