14 awar d 25outof 2500points speed world cy c les s

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Unformatted text preview: irs t­in, Firs t­out (FIFO) method: To rec ord c os t of 1,000 Ac e­5 reels s old to Angler's Warehous e. Cos t determined by the FIFO flow as s umption: 600 units @ $29, plus 400 units @ $32 = $30,200. 4. Las t­in, Firs t­out (LIFO) method: To rec ord c os t of 1,000 Ac e­5 reels s old to Angler's Warehous e. Cos t determined by the LIFO flow as s umption: 900 units @ $32, plus 100 units @ $29 = $31,700. 14. awar d: 25 out of 25.00 points Speed World Cy c les s ells high­performanc e motorc y c les and motoc ros s rac ers . One of Speed World's mos t popular models is the Kaz omma 900 dirt bik e. During the c urrent y ear, Speed World purc has ed eight of thes e c y c les at the following c os ts : Purc has e Date J uly 1 J uly 22 Aug. 3 Units Purc has ed Unit Cos t Total Cos t 2 $ 4,950 $ 9,900 3 5,000 15,000 3 5,100 15,300 8 $ 40,200 On J uly 28, Speed World s old four Kaz omma 900 dirt bik es to the Vinc e Wils on rac ing team. The remaining four bik es remained in inv entory at September 30, the end of Speed World's fis c al y ear. As s ume that Speed World us es a perpetual inv entory s y s tem. a(1) Compute the c os t of goods s old relating to the s ale on J uly 28 and the ending inv entory of Kaz omma 900 dirt bik es at September 30, us ing av erage c os t method. (Om it the "$" sign in your response.) Cos t of goods s old Ending inv entory $ 19,920 $ 20,280 a(2) Compute the c os t of goods s old relating to the s ale on J uly 28 and the ending inv entory of Kaz omma 900 dirt bik es at September 30, us ing FIFO method. (Om it the "$" sign in your response.) e z to.mhe c loud.mc gr a w- hill.c om/hm_a c c ounting.tpx? todo= pr intvie w 5/7 11/18/13 Assignme nt Pr int Vie w Cos t of goods s old Ending inv entory $ 19,900 $ 20,300 a(3) Compute the c os t of goods s old relating to the s ale on J uly 28 and the ending inv entory of Kaz omma 900 dirt bik es at September 30, us ing LIFO method. (Om it the "$" sign in your response.) Cos t of goods s old Ending inv entory $ 19,950 $ 20,250 b(1) Whic h of the three c os t flow as s umptions will res ult in Speed World Cy c les reporting the highes t net inc ome for the c urrent y ear? FIFO b(2) Whic h of the three c os t flow as s umptions will minimiz e the inc ome tax es owed by Speed World Cy c les for the y ear? LIFO b(3) May Speed World Cy c les us e the c os t flow as s umption that res ults in the highes t net inc ome for the c urrent y ear in its financ ial s tatements , but us e the c os t flow as s umption that minimiz es tax able inc ome for the c urrent y ear in its inc ome tax return? No Learning Objective: 08­01 In a perpetual inventory system, determine the cost of goods sold using (a) specific identification, (b) average cost, (c) FIFO, and (d) LIFO. Discuss the advantages and shortcomings of each method. Worksheet Speed World Cy c les s ells high­performanc e motorc y c les and motoc ros s rac ers . One of Speed World's mos t popular models is the Kaz omma 900 dirt bik e. During the c urrent y...
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