# Fifo 15 lifo 15 average per unit average

• Notes
• 107
• 84% (407) 341 out of 407 people found this document helpful

This preview shows page 86 - 90 out of 107 pages.

##### We have textbook solutions for you!
The document you are viewing contains questions related to this textbook.
The document you are viewing contains questions related to this textbook.
Chapter 7 / Exercise 4
Accounting
Reeve/Warren
Expert Verified
FIFO: 15 units @ \$39 = \$585 LIFO: 15 units @ \$30 = \$450 Average: \$3,285 / 91 = \$36.10 per unit Average: 15 units @ \$36.10 = \$541.50 141. Complete the chart using the LIFO and FIFO costing methods, assuming a period of increasing costs: Highest Amount Lowest Amount Cost of merchandise sold Gross Profit Net Income Ending Merchandise Inventory
##### We have textbook solutions for you!
The document you are viewing contains questions related to this textbook.
The document you are viewing contains questions related to this textbook.
Chapter 7 / Exercise 4
Accounting
Reeve/Warren
Expert Verified
Highest Amount Lowest Amount Cost of merchandise sold LIFO FIFO Gross Profit FIFO LIFO Net Income FIFO LIFO Ending Merchandise Inventory FIFO LIFO 142. The units of Manganese Plus available for sale during the year were as follows: Mar 1 Inventory 16 units @ \$30 \$ 480 June 16 Purchase 30 units @ \$35 1,050 Nov 28 Purchase 45 units @ \$39 1,755 91 units \$3,285 There are 15 units of the product in the physical inventory at November 30. The periodic inventory system is used. Determine the difference in gross profit between the LIFO and FIFO inventory cost systems.FIFO Cost of Merchandise Sold (16 x \$30 + 30 x \$35 + 30 x \$39) \$2,700 LIFO Cost of Merchandise Sold (45 x \$39 + 30 x \$35 + 1 x \$30) \$2,835 Difference \$ 135 143. Using the lower of cost or market, what should the total inventory value be for the following items: Item Quantity Unit cost price Unit market price Total cost price Total market price A 300 \$15.00 \$14.50 \$4,500 \$4,350 B 200 \$14.00 \$15.00 \$2,800 \$3,000 C 100 \$17.00 \$17.50 \$1,700 \$1,750 Apply the lower-of-cost-or-market method to inventory as a whole.Item Quantity Unit cost price Unit market price Total cost price Total market price Lower of cost or market A 300 \$15.00 \$14.50 \$4,500 \$4,350 \$4,350 B 200 \$14.00 \$15.00 \$2,800 \$3,000 \$2,800 C 100 \$17.00 \$17.50 \$1,700 \$1,750 \$1,700 \$8,850
144. The following information was extracted from the Stone Company’s records. Gross Sales \$232,566 Gross Profit \$87,990 Sales Discounts \$1,125 (= 1/2 % of Net Sales) Total Operating Expenses \$88, 440 Selling Expenses \$33, 560 Complete the following: Gross Sales Sales Discounts Sales Returns & Allowances Net Sales Cost of Goods Sold Gross Profit Operating Expenses: Gen. & Admin Expenses Selling Expenses Total Operating Expenses Net Income (Loss) Complete the following: Gross Sales \$232,566 Sales Discounts \$1,125 Sales Returns & Allowances ** 6,441 Net Sales * \$225,000 Cost of Goods Sold *** \$137,010 Gross Profit \$ 87,990 Operating Expenses: Gen. & Adm. Expenses \$54,880 Selling Expenses \$33,560 Total Operating Expenses \$88,440 Net Income (Loss) (\$450) * Net Sales: \$1,125 = .005 X Net Sales \$1,125 / .005 = \$225,000 ** Sales Returns & Allowances: \$232,566 - \$225,000 - \$1,125 = \$6,441 *** Cost of Goods Sold: \$225,000 - \$87,990 = \$137,010 **** Gen. & Adm. Expenses = \$88,440 - \$33,560 = \$54,880 145. Determine the total value of the merchandise using Net Realizable Value: Item Quantity Selling Price Commission Doll 10 \$7 \$2 Horse 5 9 3
Item Quantity Selling Price Commission Total Doll 10 \$7 \$2 \$50 Horse 5 9 3 30 Total \$80 146. During the taking of its physical inventory on December 31, 2011, Gentry Supplies Company incorrectly counted its inventory as \$245,000 instead of the correct amount of \$254,000. Indicate the affect of the misstatement on Gentry Supplies Company’s balance sheet and income statement for the year ended December 31, 2011. Amount of Misstatement Overstatement (Understatement) Balance Sheet: Merchandise inventory understated (\$9,000) Current assets understated (\$9,000) Total assets understated (\$9,000) Owner’s equity understated (\$9,000) Income Statement: Cost of merchandise sold overstated \$9,000 Gross profit understated (\$9,000) Net Income understated (\$9,000)