Question

NOTE: Note : PLEASE ANSWER PART B ONLY . PLEASE I posted Question PART B before but the answer is not correct as my teacher said and I posted again please answer correctly

Q4 )Flounder Inc. is a retailer using a perpetual inventory system. All sales returns from customers result in the goods being returned to inventory. (Assume that the inventory is not damaged.) Assume that there are no credit transactions; all amounts are settled in cash. You are provided with the following information for Flounder Inc. for the month of January.

Date			Description		Quantity				Unit Cost or Selling Price
Dec.	31		Ending inventory			160				$19
Jan.	2		Purchase			100				23
Jan.	6		Sale			180				38
Jan.	9		Sale return			10				38
Jan.	9		Purchase			75				24
Jan.	10		Purchase return			15				24
Jan.	10		Sale			50				45
Jan.	23		Purchase			100				27
Jan.	30		Sale			120				51

A) Using FIFO method, calculate (i) cost of goods sold, (ii) ending inventory, and (iii) gross profit. (Assume sales returns had a cost of $19 and purchase returns had a cost of $24.)

Cost of goods sold		$
Ending Inventory		$
Gross Profit		$

B) Using Average method, calculate (i) cost of goods sold, (ii) ending inventory, and (iii) gross profit. (Round average cost to 3 decimal places, e.g. 5.252 and final answers to 2 decimal places, e.g 5.25.)

  

Answer 1

19 Date beg. Inv. purchases Sales Purchases Sales Purchases Sales Total Moving average (perpetual) Cost of goods available for sale COGS Ending Inventory No. of units cost p.u Cost of goods available for sale No. of units cost pu COGS No. of units cost p.u Ending inventory 160 19 3040 160 3040 100 23 2300 260 20.53846154 5340 170 20.53846154 3491.538462 90 20.53846154 1848.461538 60 24 1440 150 21.92307692 3288.461538 50 21.92307692 1096.153846 100 21.92307692 2192.307692 2700 200 24.46153846 4892.307692 120 24.46153846 2935.384615 80 24.46153846 1956.923077 420 340 7523.076923 80 1956.923077 100 9480 COGS Ending inv. 7523 1957 Sales 170* 38 50* 45 120*51 Total Sales Less:- COGS GP 6460 2250 6120 14830 7523 7307