Question

Newman’s Televisions produces television sets in three categories: portable, midsize, and flat-screen. On January 1, 2017, Newman adopted dollar-value LIFO and decided to use a single inventory pool. The company’s January 1 inventory consists of:

Category		Quantity		Cost per Unit		Total Cost
Portable		6,000		$132		$ 792,000
Midsize		8,400		330		2,772,000
Flat-screen		2,900		528		1,531,200
		17,300				$5,095,200

During 2017, the company had the following purchases and sales.

Category		Quantity Purchased		Cost per Unit		Quantity Sold		Selling Price per Unit
Portable		14,800		$145		14,700		$198
Midsize		19,700		396		23,900		535
Flat-screen		10,500		660		6,000		792
		45,000				44,600

Price Index?

Ending Inventory?

Cost of Goods Sold?

Gross Profit?

Answer 1

Joution on Jan 1, 2017, Newman adopted doi tay - varve LIFO & decided to use a single inventory pool. Quontily ending ending inventore inventory Pools Item I beginning Quontity Quantity inventory I purchased I lawn Suid Sold ending inventory ending muitiple baseCost & inventory Pools Current price es4( al index inventory " Portable! 6.000 24.800 ,000 831,600 913.500 1098 midsize 8.400 19,700 23900 5,200 1,716,000 2,059,200 42 fiat Screen 4,422,000 1.25 3.537,600 2,900 10500 6700 6.000 total 1 17,300 45,000 44.600 6,085,200 7,394,700 18 ending inventary base cost is Portable - 6.300 x $132 = 831,600 => mid Size' 5,200 X 330 1,776,000 Flat Screen -5 6700 X 528 = 3,5 37,600 Total 6,085,200

ending inventory Curreni cost $105 -) =) 913,500 6,300 x 6,300 X » Portable => 2,0592.00 mid size 5) 5,200 x 396 Flat Screen 5) 6,700 X 660 5) ,422,000 Total = 7,394,700 index morti pie PoolS price 913,500 1098 portable 831,600 mid size' = 12 2,059,900 1,716,000 = 1.25 pOf Screen 4,022,000 3,537, 000 ending in - price index = ending inventory base cost 7.394,700 1.21 6,085,200 .

LIFO . ending inventory (5,09 Base lavey 5,045,200 incremental layer =) =) (6.085,200 - 5,093,200)*1.21 » 1,197,900 ... ending inventory' => 5,095,200 + 1,197,900 >> 6,293,100 coas ir Base beginning inventory = 5,095,2.00 foral porchases - $ 15,837, 200 Cost of goods avaiable . The S : 5,095,200. + 15,837,200 - 20,432,400 coas = 20,932, 400 - 6,293,100 .: 142639,300 Cross profit : Total sales-) 14.900* $198 +23900* 535 + 6000* 792. =) 20,449,100

Cross profit =) Sales - cous -> 20,049,100 - 14,639,300 >> $5,809,800