Week Three Exercise Assignment B
Week Three Exercise Assignment
Inventory
1. Specific identification method. Boston Galleries uses the specific identification method for inventory valuation. Inventory information for several oil paintings follows. Painting Cost
1/2 Beginning inventory Woods $21,000
4/19 Purchase Sunset 21,800
6/7 Purchase Earth 31,200
12/16 Purchase Moon 4,000
Woods and Moon were sold during the year for a total of $35,000. Determine the firm’s
a. cost of goods sold. = (Woods)- 21,000+ (Moon)-4,000=25,000
b. gross profit. =35,000-25,000=10,000
c. ending inventory. =21,800+31,200=53,000
2. Inventory valuation methods: basic computations. The January beginning inventory of the White Company consisted of 300 units costing $40 each. During the first quarter, the company purchased two batches of goods: 700 Units at $44 on February 21 and 800 units at $50 on March 28. Sales during the first quarter were 1,400 units at $75 per unit. The White Company uses a periodic inventory system. Using the White Company data, fill in the following chart to compare the results obtained under the FIFO, LIFO, and weighted-average inventory methods.
FIFO LIFO Weighted Average
Goods Available for Sale $82,800 $82,800 $82,800
Ending Inventory, March 31 20,000 16,400 18,400
Cost of Goods Sold 62,800 66,400 64,400
3. Perpetual inventory system: journal entries. At the beginning of 20X3, Beehler Company implemented a computerized perpetual inventory system. The first transactions that occurred during 20X3 follow:
1/2/20X3 Purchases on account: 500 units @ $6 = $3,000
1/15/20X3 Sales on account: 300 units @ $8.50 = $2,550
1/20/20X3 Purchases on Account: 200 units @ 5 = $1,000
1/25/20X3Sales on Account: 300 units @ $8.50 = $2,550
The company president examined the computer-generated journal entries for these transactions and was confused by the absence of a Purchases account.
Duplicate the journal entries
Inventory
1. Specific identification method. Boston Galleries uses the specific identification method for inventory valuation. Inventory information for several oil paintings follows. Painting Cost
1/2 Beginning inventory Woods $21,000
4/19 Purchase Sunset 21,800
6/7 Purchase Earth 31,200
12/16 Purchase Moon 4,000
Woods and Moon were sold during the year for a total of $35,000. Determine the firm’s
a. cost of goods sold. = (Woods)- 21,000+ (Moon)-4,000=25,000
b. gross profit. =35,000-25,000=10,000
c. ending inventory. =21,800+31,200=53,000
2. Inventory valuation methods: basic computations. The January beginning inventory of the White Company consisted of 300 units costing $40 each. During the first quarter, the company purchased two batches of goods: 700 Units at $44 on February 21 and 800 units at $50 on March 28. Sales during the first quarter were 1,400 units at $75 per unit. The White Company uses a periodic inventory system. Using the White Company data, fill in the following chart to compare the results obtained under the FIFO, LIFO, and weighted-average inventory methods.
FIFO LIFO Weighted Average
Goods Available for Sale $82,800 $82,800 $82,800
Ending Inventory, March 31 20,000 16,400 18,400
Cost of Goods Sold 62,800 66,400 64,400
3. Perpetual inventory system: journal entries. At the beginning of 20X3, Beehler Company implemented a computerized perpetual inventory system. The first transactions that occurred during 20X3 follow:
1/2/20X3 Purchases on account: 500 units @ $6 = $3,000
1/15/20X3 Sales on account: 300 units @ $8.50 = $2,550
1/20/20X3 Purchases on Account: 200 units @ 5 = $1,000
1/25/20X3Sales on Account: 300 units @ $8.50 = $2,550
The company president examined the computer-generated journal entries for these transactions and was confused by the absence of a Purchases account.
Duplicate the journal entries