chapter 6 hw
Chapter 6
Inventory & Cost of Goods Sold
Short Exercises
(10 min.) S 6-1
Billions
Inventory…………………………
3.8
Cash…………………………...
3.8
Accounts Receivable………….
19.7
Sales Revenue……………….
19.7
Cost of Goods Sold……………
4.5
Inventory……………………...
4.5
Cash………………………………
18.8
Accounts Receivable……….
18.8
(10-15 min.) S 6-2
1. (Journal entries)
Inventory…………………………………..
120,000
Accounts Payable…………………….
120,000
Amounts Receivable……………………
150,000
Sales Revenue………………………...
150,000
Cost of Goods Sold……………………..
90,000
Inventory ($120,000 × .75)…………..
90,000
Cash ($150,000 × .30)…………………...
45,000
Accounts Receivable………………...
45,000
2. (Financial statements)
BALANCE SHEET
Current assets:
Inventory ($120,000 − $90,000)……………….
$ 30,000
INCOME STATEMENT
Sales revenue………………………………………
$150,000
Cost of goods sold……………………………….. 90,000 Gross profit…………………………………………
$60,000
(15-20 min.) S 6-3
a b c
Average Cost
FIFO
LIFO
Cost of goods sold:
Average (26 × $154.71)
$4,022.46
FIFO $1,260 + (17 × $160)
$3,980
LIFO $4,000 + (1 × $140)
$4,140
Ending inventory:
Average (8 × $154.71)
$ 1,237.68
FIFO (8 × $160)
$1,280
LIFO (8 × $140)
$1,120
Computations: Units sold = 26 (9 + 25 − 8) Units in ending inventory = 8 Average cost per unit = $154.71 ($1,260 + $4,000) ÷ (9 + 25) Cost per unit: First purchase = $140 ($1,260 ÷ 9 = $140) Second purchase = $160 ($4,000 ÷ 25 = $160)
(10-15 min.) S 6-4
Jefferson’s Copy Center
Income Statement
Year Ended December 31, 2010
Average FIFO LIFO
Sales revenue (580 × $20.25)
$11,745
$11,745
$11,745
Cost of goods sold (580 × $9.70*)
5,626
(92 × $8.90) + (488 × $9.80)
5,601
(580 × $9.80)
Inventory & Cost of Goods Sold
Short Exercises
(10 min.) S 6-1
Billions
Inventory…………………………
3.8
Cash…………………………...
3.8
Accounts Receivable………….
19.7
Sales Revenue……………….
19.7
Cost of Goods Sold……………
4.5
Inventory……………………...
4.5
Cash………………………………
18.8
Accounts Receivable……….
18.8
(10-15 min.) S 6-2
1. (Journal entries)
Inventory…………………………………..
120,000
Accounts Payable…………………….
120,000
Amounts Receivable……………………
150,000
Sales Revenue………………………...
150,000
Cost of Goods Sold……………………..
90,000
Inventory ($120,000 × .75)…………..
90,000
Cash ($150,000 × .30)…………………...
45,000
Accounts Receivable………………...
45,000
2. (Financial statements)
BALANCE SHEET
Current assets:
Inventory ($120,000 − $90,000)……………….
$ 30,000
INCOME STATEMENT
Sales revenue………………………………………
$150,000
Cost of goods sold……………………………….. 90,000 Gross profit…………………………………………
$60,000
(15-20 min.) S 6-3
a b c
Average Cost
FIFO
LIFO
Cost of goods sold:
Average (26 × $154.71)
$4,022.46
FIFO $1,260 + (17 × $160)
$3,980
LIFO $4,000 + (1 × $140)
$4,140
Ending inventory:
Average (8 × $154.71)
$ 1,237.68
FIFO (8 × $160)
$1,280
LIFO (8 × $140)
$1,120
Computations: Units sold = 26 (9 + 25 − 8) Units in ending inventory = 8 Average cost per unit = $154.71 ($1,260 + $4,000) ÷ (9 + 25) Cost per unit: First purchase = $140 ($1,260 ÷ 9 = $140) Second purchase = $160 ($4,000 ÷ 25 = $160)
(10-15 min.) S 6-4
Jefferson’s Copy Center
Income Statement
Year Ended December 31, 2010
Average FIFO LIFO
Sales revenue (580 × $20.25)
$11,745
$11,745
$11,745
Cost of goods sold (580 × $9.70*)
5,626
(92 × $8.90) + (488 × $9.80)
5,601
(580 × $9.80)