Question

Shepherd Cycles started August with 25 bicycles that cost $65 each. On August 16, Shepherd bought 50 bicycles at $80 each. On August 31, Shepherd sold 40 bicycles for $99 each. Requirements Prepare Shepherd Cycle's perpetual inventory record assuming the company uses the LIFO inventory costing method. 2. Journalize the August 16 purchase of merchandise inventory on account and the August 31 sale of merchandise inventory on account. 1. Requirement 1. Prepare Shepherd Cycle's perpetual inventory record assuming the company uses the LIFO inventory costing method. Start by entering the beginning inventory balances. Enter the transactions in chronological order, calculating new inventory on hand balances after each transaction. Once all of the transactions have been entered into the perpetual record, calculate the quantity and total cost of inventory purchased, sold, and on hand at the end of the period. (For cost of goods sold, enter the first layer out under LIFO costing first. For inventory on hand, enter the oldest inventory layer first. Abbreviation used: QTY = Quantity; Tot. = Total) Shepherd Cycles Purchases Cost of Goods Sold Date QTY Unit Cost Tot. Cost | QTY Unit Cost Tot. Cost Aug. 1 Aug. 16 Inventory on Hand QTY Unit Cost Tot. Cost Aug. 31 Totals

Answer 1

				Cost og good sold			Inventory of hand
Date	Qty	Units	Total	Qty	Units	Total	Qty	Units	Total
1-Aug							25	65	1625
16-Aug	50	80	4000				50	80	4000
							75		5625
31-Aug				40	80	3200	25	65	1625
							10	80	800
Total	50		4000	40		3200	35		2425
	Accounts Title	Dr	Cr
16-Aug	Inventory	3200
	Accounts Payable		3200
	(being inventory purchased on account)
31-Aug	Accounts Receivable	3960
	Sales (40*99)		3960
	(being sales made on account)
31-Aug	Cost of good sold	3200
	Inventory		3200
	(being cost of good sold recorded)
If any doubt please comment