hmwk_ch6 - PRACTICE EXERCISES PE 61A Gross Profit a....

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PRACTICE EXERCISES PE 6–1A Gross Profit Ending Inventory a. First-in, first-out (FIFO) $35 ($150 – $115) $239 ($118 + $121) b. Last-in, first-out (LIFO) $29 ($150 – $121) $233 ($115 + $118) c. Average cost $32 ($150 – $118) $236 ($118 × 2) PE 6–1B Gross Profit Ending Inventory a. First-in, first-out (FIFO) $12 ($100 – $88) $167 ($85 + $82) b. Last-in, first-out (LIFO) $18 ($100 – $82) $173 ($88 + $85) c. Average cost $15 ($100 – $85) $170 ($85 × 2) PE 6–2A a. Cost of merchandise sold (August 30): 13 units @ $34 $442 7 units @ $38 266 20 $708 b. Inventory, August 31: $570 = (15 units × $38)
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PE 6–2B a. Cost of merchandise sold (March 29): 5 units @ $10 $ 50 35 units @ $14 490 40 $540 b. Inventory, March 31: $308 = (22 units × $ 14)
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PE 6–3A a. Cost of merchandise sold (August 30): $760 = (20 units × $38) b. Inventory, August 31: 13 units @ $34 $442 2 units @ $38 76 15 $518 PE 6–3B a. Cost of merchandise sold (March 29): $560 = (40 units × $14) b. Inventory, March 31: 5 units @ $10 $ 50 17 units @ $14 238 22 $288 PE 6–4A a. First-in, first-out (FIFO) method: $720 = (20 units × $36) b. Last-in, first-out (LIFO) method: $540 = (12 units × $25) + (8 units × $30) c. Average cost method: $645 (20 units × $32.25), where average cost = $32.25 = $2,580/80 units
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PE 6–4B a. First-in, first-out (FIFO) method: $9,550 = (36 units × $250) + (2 units × $275) b. Last-in, first-out (LIFO) method: $10,900 = (18 units × $300) + (20 units × $275) c. Average cost method: $10,279 (38 units × $270.50), where average cost = $270.50 = $27,050/100 units PE 6–5A A B C D E F G Unit Unit Total Inventory Cost Market Lower Commodity Quantity Price Price Cost Market of C or M 1 TRP4 96 $29 18 $2,784 $1,728 $1,728 1 2 V555 200 13 14 2,600 2,800 2,600 2 3 Total $5,384 $4,528 $4,328 3 PE 6–5B A B C D E F G Unit Unit Total Inventory Cost Market Lower Commodity Quantity Price Price Cost Market of C or M 1 E662 215 $30 $28 $ 6,450 $ 6,020 $ 6,020 1 2 C11R 741 22 26 16,302 19,266 16,302 2 3 Total $ 22,752 $ 25,286 $ 22,322 3 PE 6–6A
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Amount of Misstatement Overstatement (Understatement) Balance Sheet: Merchandise inventory understated. ............ $(9,000) Current assets understated. .......................... (9,000) Total assets understated. ............................... (9,000) Stockholders’ equity understated. ................ (9,000) Income Statement: Cost of merchandise sold overstated. .......... $ 9,000 Gross profit understated. ............................... (9,000) Net income understated. ................................ (9,000)
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PE 6–6B Amount of Misstatement Overstatement (Understatement) Balance Sheet: Merchandise inventory overstated. .............. $ 29,000
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hmwk_ch6 - PRACTICE EXERCISES PE 61A Gross Profit a....

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