Tech Support, Diane Casey,
Wendy Styron, Kimberly Garrett, Jennifer
Agee, Dee Wessler, Jennifer Byrom,
Kristy Hawkins, Christina Horton, Faculty
Services, Dawn Dunson, Mark Nelson
Unit V Homework
Coffee Shop completed the following
inventory transactions for a line of merchandise inventory:
(Click the icon to view the transactions.)
Compute ending merchandise inventory, cost of goods sold, and gross profit using the FIFO inventory costing method.
Compute ending merchandise inventory, cost of goods sold, and gross profit using the LIFO inventory costing method.
Compute ending merchandise inventory, cost of goods sold, and gross profit using the weighted-average inventory costing
method. (Round weighted-average cost per unit to the nearest cent and all other amounts to the nearest dollar.)
Accounting is simpler in a periodic inventory system because the company keeps no daily running record of inventory on hand.
The only way to determine the ending merchandise inventory and cost of goods sold in a periodic inventory system is to take a
physical inventory to count the goods left (on hand)
usually at the end of the fiscal year. The periodic inventory system works
well for a small business in which the inventory can be controlled by visual inspection
that is, the inventory usually is not large
in size or dollar amount.
For all inventory costing methods, cost of goods available for sale is always the sum of beginning inventory plus net purchases.
Go ahead and use the information given in the problem to calculate the dollar value of beginning merchandise inventory, net
purchases, and cost of goods available for sale for the period.
Cost per unit
Beginning merchandise inventory
Plus: Net Purchases
Jun. 12 purchase
Jun. 24 purchase
Total net purchases
Cost of goods available for sale
The different inventory costing methods