hmwk_ch6

# 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)
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
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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