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Session%2009 - Solutions for Session 09 Assignments...

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Solutions for Session 09 Assignments: Multiple Choice (page 301): 1 . The correct answer is not among the choices. The correct answer is $12,500. 2. a 3. b 4. d 5. a 6. b 7. a 8. c 9. d 10. b E6-1A If Mira Company sold 1,000 units, what was the value of ending inventory using (1) FIFO, (2) LIFO, (3) weighted average cost? Use periodic record keeping. INVENTORY No. of units Unit cost Total cost Purchase 1 500 $5 $2,500 Purchase 2 400 $6 2,400 Purchase 3 300 $7 2,100 Cost of goods available for sale 1,200 $7,000 Less goods sold (1,000 ) Ending inventory 200 Ending inventory: FIFO LIFO Weighted-average 200 units @ $7 @ $5 @ $5.83 $1,400 $1,000 $1,167
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E6-9A What inventory amount will this firm report on its balance sheet at December 31, 2011? $16,545 Ending inventory at replacement cost (market) is lower than cost. P6-4A Compute the cost of goods sold and ending inventory using (1) FIFO periodic, (2) LIFO periodic, and (3) Weighted avg. cost periodic. Weighted FIFO LIFO Avg cost Periodic Periodic Periodic Ending Inventory $13,200 $11,000 $12,166 Cost of Goods Sold $42,100 $44,300 $43,134 Detailed calculations follow. _________________________________________________________________________________________________ INVENTORY No. of units Unit cost Total cost Beg. inventory 1/1/06 160 $100 $16,000 Purchases #1 150 $110 16,500 #2 190 $120 22,800 Cost of goods available for sale 500 $55,300 No. of units Sales price Total Revenue Sales #1 390 $200 $78,000 Units sold 390 $78,000 _________________________________________________________________________________________________ FIFO Periodic No. of units sold Unit cost Total cost FIFO 160 $100 $16,000 150 $110 16,500
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80 $120 9,600 Cost of goods sold 390 $42,100 No. units remaining Unit cost Total cost FIFO 0 $100 $ - 0 $110 - 110 $120 13,200 Ending Inventory 110 $13,200 LIFO Periodic No. of units sold Unit cost Total cost LIFO 190 $120 $22,800 150 $110 16,500 50 $100 5,000 Cost of goods sold 390 $44,300 No. units remaining Unit cost Total cost LIFO 110 $100 $11,000 0 $110 - 0 $120 - Ending Inventory 110 $11,000 Weighted Average Cost Periodic Weighted average cost: $110.60 = $55,300 / 500
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