Greg’s Bicycle Shop has the following transactions related to its top-selling Mongoose mountain bike for the...
Greg’s Bicycle Shop has the following transactions related to its top-selling Mongoose mountain bike for the month of March. Greg's Bicycle Shop uses a periodic inventory system.
| Date | Transactions | Units | Cost per Unit |
Total Cost | |
| March 1 | Beginning inventory | 20 | $200 | $ | 4,000 |
| March 5 | Sale ($300 each) | 15 | |||
| March 9 | Purchase | 10 | 220 | 2,200 | |
| March 17 | Sale ($350 each) | 8 | |||
| March 22 | Purchase | 10 | 230 | 2,300 | |
| March 27 | Sale ($375 each) | 12 | |||
| March 30 | Purchase | 8 | 250 | 2,000 | |
| $ | 10,500 | ||||
rev: 02_28_2017_QC_CS-80932
1.
value:
9.16 points
Required information
Required:
1. Calculate ending inventory and cost of goods
sold at March 31, using the specific identification method. The
March 5 sale consists of bikes from beginning inventory, the March
17 sale consists of bikes from the March 9 purchase, and the March
27 sale consists of four bikes from beginning inventory and eight
bikes from the March 22 purchase.
References
eBook & Resources
WorksheetLearning Objective: 06-03 Determine the cost of goods sold and ending inventory using different inventory cost methods.Learning Objective: 06-05 Record inventory transactions using a perpetual inventory system.
Difficulty: 3 HardLearning Objective: 06-04 Explain the financial statement effects and tax effects of inventory cost methods.
Check my work
2.
value:
9.16 points
Required information
2. Using FIFO, calculate ending inventory and
cost of goods sold at March 31.
References
eBook & Resources
WorksheetLearning Objective: 06-03 Determine the cost of goods sold and ending inventory using different inventory cost methods.Learning Objective: 06-05 Record inventory transactions using a perpetual inventory system.
Difficulty: 3 HardLearning Objective: 06-04 Explain the financial statement effects and tax effects of inventory cost methods.
Check my work
3.
value:
9.16 points
Required information
3. Using LIFO, calculate ending inventory and
cost of goods sold at March 31.
References
eBook & Resources
WorksheetLearning Objective: 06-03 Determine the cost of goods sold and ending inventory using different inventory cost methods.Learning Objective: 06-05 Record inventory transactions using a perpetual inventory system.
Difficulty: 3 HardLearning Objective: 06-04 Explain the financial statement effects and tax effects of inventory cost methods.
Check my work
4.
value:
9.16 points
Required information
4. Using weighted-average cost, calculate
ending inventory and cost of goods sold at March 31. (Round
your intermediate and final answers to 2 decimal places.)
References
eBook & Resources
WorksheetLearning Objective: 06-03 Determine the cost of goods sold and ending inventory using different inventory cost methods.Learning Objective: 06-05 Record inventory transactions using a perpetual inventory system.
Difficulty: 3 HardLearning Objective: 06-04 Explain the financial statement effects and tax effects of inventory cost methods.
Check my work
5.
value:
9.16 points
Required information
5. Calculate sales revenue and gross profit
under each of the four methods.(Round weighted-average cost
amounts to 2 decimal places.)
References
eBook & Resources
WorksheetLearning Objective: 06-03 Determine the cost of goods sold and ending inventory using different inventory cost methods.Learning Objective: 06-05 Record inventory transactions using a perpetual inventory system.
Difficulty: 3 HardLearning Objective: 06-04 Explain the financial statement effects and tax effects of inventory cost methods.
Check my work
6.
value:
9.20 points
Required information
6. Comparing FIFO and LIFO, which one provides the more meaningful measure of ending inventory?
FIFO
LIFO
Homework Answers
Answer to Q1 - Specific Identification Method
Ending inventory
|
Particulars |
Qty |
Rate |
Amount |
|
From beginning inventory |
1 |
200 |
200 |
|
From March 9 purchase |
2 |
220 |
440 |
|
From March 22 purchase |
2 |
230 |
460 |
|
From March 30 Purchase |
8 |
250 |
2000 |
|
Ending inventory |
13 |
$ 3100 |
Cost of Goods Sold (COGS) = Beginning inventory + Purchases -
Ending inventory
= 4000 + 6500 - 3100
= $7400
Answer to Q2 - FIFO method
Ending inventory
|
Particulars |
Qty |
Rate |
Amount |
|
From March 22 purchase |
5 |
230 |
1150 |
|
From March 30 Purchase |
8 |
250 |
2000 |
|
Ending inventory |
13 |
$ 3150 |
Cost of Goods Sold (COGS) = Beginning inventory + Purchases - Ending inventory
= 4000 + 6500 - 3150
= $7350
Working note
|
Date |
Purchase |
Sale |
Balances |
||||||
|
March |
Qty |
Rate |
Amount |
Qty |
Rate |
Amount |
Qty |
Rate |
Amount |
|
1 |
20 |
$ 200 |
$ 4,000 |
20 |
$ 200 |
$ 4,000 |
|||
|
5 |
15 |
$ 300 |
$ 4,500 |
5 |
$ 200 |
$ 1,000 |
|||
|
9 |
10 |
$ 220 |
$ 2,200 |
15 |
$ 213 |
$ 3,200 |
|||
|
5 |
$ 200 |
$ 1,000 |
|||||||
|
10 |
$ 220 |
$ 2,200 |
|||||||
|
17 |
8 |
$ 350 |
$ 2,800 |
7 |
$ 220 |
$ 1,540 |
|||
|
22 |
10 |
$ 230 |
$ 2,300 |
17 |
$ 226 |
$ 3,840 |
|||
|
7 |
$ 220 |
$ 1,540 |
|||||||
|
10 |
$ 230 |
$ 2,300 |
|||||||
|
27 |
12 |
$ 375 |
$ 4,500 |
5 |
$ 230 |
$ 1,150 |
|||
|
30 |
8 |
$ 250 |
$ 2,000 |
13 |
$ 242 |
$ 3,150 |
|||
|
5 |
$ 230 |
$ 1,150 |
|||||||
|
8 |
$ 250 |
$ 2,000 |
Answer to Q3 - LIFO method
Ending inventory
|
Particulars |
Qty |
Rate |
Amount |
|
From Beginning inventory |
5 |
200 |
1000 |
|
From March 30 Purchase |
8 |
250 |
2000 |
|
Ending inventory |
13 |
$ 3000 |
Cost of Goods Sold (COGS) = Beginning inventory + Purchases - Ending inventory
= 4000 + 6500 - 3000
= $7500
Working note
|
Date |
Purchase |
Sale |
Balances |
||||||
|
March |
Qty |
Rate |
Amount |
Qty |
Rate |
Amount |
Qty |
Rate |
Amount |
|
1 |
20 |
$ 200 |
$ 4,000 |
20 |
$ 200 |
$ 4,000 |
|||
|
5 |
15 |
$ 300 |
$ 4,500 |
5 |
$ 200 |
$ 1,000 |
|||
|
9 |
10 |
$ 220 |
$ 2,200 |
15 |
$ 213 |
$ 3,200 |
|||
|
5 |
$ 200 |
$ 1,000 |
|||||||
|
10 |
$ 220 |
$ 2,200 |
|||||||
|
17 |
8 |
$ 350 |
$ 2,800 |
7 |
$ 206 |
$ 1,440 |
|||
|
5 |
$ 200 |
$ 1,000 |
|||||||
|
2 |
$ 220 |
$ 440 |
|||||||
|
22 |
10 |
$ 230 |
$ 2,300 |
17 |
$ 220 |
$ 3,740 |
|||
|
5 |
$ 200 |
$ 1,000 |
|||||||
|
2 |
$ 220 |
$ 440 |
|||||||
|
10 |
$ 230 |
$ 2,300 |
|||||||
|
27 |
12 |
$ 375 |
$ 4,500 |
5 |
$ 200 |
$ 1,000 |
|||
|
30 |
8 |
$ 250 |
$ 2,000 |
13 |
$ 231 |
$ 3,000 |
|||
|
5 |
$ 200 |
$ 1,000 |
|||||||
|
8 |
$ 250 |
$ 2,000 |
Answer to Q4 - Weighted average method
Ending inventory = 13 units * $239.62 = $3115
Cost of Goods Sold (COGS) = Beginning inventory + Purchases - Ending inventory
= 4000 + 6500 - 3115
= $7385
Working Note
|
Date |
Purchase |
Sale |
Balances |
||||||
|
March |
Qty |
Rate |
Amount |
Qty |
Rate |
Amount |
Qty |
Rate |
Amount |
|
1 |
20 |
$ 200 |
$ 4,000 |
20 |
$ 200.00 |
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Greg’s Bicycle Shop has the following transactions related to its
top-selling Mongoose mountain bike for the month of March.
Greg's Bicycle Shop uses a periodic inventory system.DateTransactionsUnitsUnit
CostTotal CostMarch1Beginning inventory20$180$3,600March5Sale ($260
each)15March9Purchase102002,000March17Sale ($310
each)8March22Purchase102102,100March27Sale ($335
each)12March30Purchase72301,610$9,310Required:1 a) Calculate ending inventory and cost of
goods sold at March 31, using the specific identification method.
The March 5 sale consists of bikes from beginning inventory, the
March 17 sale consists of bikes from the March 9 purchase, and the
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