Question

Requirement 1. Compute cost of goods sold and gross profit using the FIFO inventory costing method Begin by computing the cost of goods sold and cost of ending merchandise inventory using the FIFO inventory costing method. Enter the transacions in chronalogical order, calculating news inventory an hand balances ater each transaction Once all of the transacions have been entered into the perpetal record, caloulate the quantly and total oost of merchandise inventory purchased, sold, and on hand at the end of the period. (Enter the aldest 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 Jul. 1 11 Enter any number in the edit fields and then continue to the next question.

Answer 1

FIFO Method Cost of goods sold Date Purchases Sales Balance Sale price Units Unit Cost Total Units Unit Cost Total Units Total Units Unit Cost Total 25 50 $ 1,250 1-Jul 15 $58.00 $870 25 $ 50 1,250 11-Jul 15 58 $ 870 $73.00 $1,460 $50.00 $1.000 5 S 50 250 23-Jul 20 20 15 58 870 $72.00 $1.296 5 $ 50 $ 250 26-Jul 18 15 $ 58 $ 870 $ 18 72 1,296 $73.00 $1,533 5 50 $ 250 29-Jul 21 15 58 $ 870 72 $ $ 72 17 72 1,224 $2,166 S S 1,224 Total 33 41 2,993 41 2,192 17 LIFO Method Cost of goods sold Date Purchases Sales Balance Sale price Total Units Unit Cost Total Units Total Units Unit Cost Units Unit Cost Total 1,250 1,250 25 S 50 1-Jul 11-Jul 15 $58.00 $870 25 50 15 58 870 $73.00 $1,460 15 $58.00 $870 23-Jul 20 5 $50.00 $250 $50.00 1,000 26-Jul $72.00 $1,296 $50.00 18 1.000 $72.00 18 1,296 $73.00 $1,533 72 $ $50.00 850 29-Jul 21 18 1.296 17 50 $ 150 3 S 2,166 S $ 2,566 850 Total 33 41 2,993 41 17 te te te 220 CO

Moving Average Cost of goods sold Date Purchases Sales Balance Unit Cost Unit Cost Total Units Total Units Units Unit Cost Total Units Unit Cost Total 25 $ 50 1,250.00 1-Jul 11-Jul 15 $58.00 $870 50 1,250.00 2. $ 58 15 870.00 $53.00 40 2,120.00 $73.00 $1,460 $53.00 $1.060 $53.00 23-Jul 20 20 20 1,060.00 18 $72.00 $1,296 $53.00 26-Jul 20 1,060.00 $72.00 11 1,296,00 $62.00 2,356.00 38 $73.00 $1.533 21 $62.00 $1,302 $81.00 29-Jul 21 17 1.377.00 Total 33 $ $2,362 2,166 41 2,993 41 17 1,377

Summary Moving- FIFO LIFO Average Sales Less: Cost of goods sold Gross Profit $2,993 $2,993 $2,993 $2,192 $2,566 $2,362 $631 $801 $427 FIFO method yield highest gross profit because lesser cost was paid for earlier inventory