This company uses the perpetual inventory system

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Accounting
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Chapter 7 / Exercise 7-6
Accounting
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This company uses the perpetual inventory system, which means that its merchandise inventory account is continually updated to reflect purchases and sales. Regardless of what inventory method or system is used, merchandise available for sale must be allocated between cost of goods sold and ending inventory.Cost ofgoods soldInventory(Balance Sheet)April 10 at $12April 15 at $14April 20 at $16 and at $17DateActivityUnits Acquired at CostUnits Sold at RetailUnit InventoryAug. 1Beginning inventory10 units @ $ 91 = $ 91010 unitsAug. 3Purchases15 units @ $ 106 = $ 1,59025 unitsAug. 14Sales20 units @ $ 1305 unitsAug. 17Purchases20 units @ $115 = $ 2,30025 unitsAug. 28Purchases10 units @ $119 = $ 1,19035 unitsAug. 31Sales23 units @ $ 150Totals55 units $ 5,99043 units12 unitsBeginninginventory+Netpurchases= Merchandiseavailable for saleEndinginventory
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Chapter 7 / Exercise 7-6
Accounting
Reeve/Warren
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When each item in inventory can be identified with a specific purchase and invoice, we can use specific identificationto assign costs. To do so, we need sales records that identify exactly which items were sold and when. Applying specific identification, we can prepare a table to determine the cost of goods sold and ending inventory amounts. Each unit, whether sold or remaining in inventory, has its own specific cost attached to it. Let us work through the computations.When each item in inventory can be identified with a specific purchase and invoice, we can use specific identificationto assign costs. To do so, we need sales records that identify exactly whichitems were sold and when. Applying specific identification, we can prepare a table to determine the cost of goods sold and ending inventory amounts. Each unit, whether sold or remaining in inventory, has its own specific cost attached to it. Let us work through the computations.The table starts with beginning inventory consisting of 10 units at $91 each.On August 3, 15 more units are purchased at $106 each for $1,590. Inventory available now consists of 25 units costing $2,500 (or $910 + $1,590).On August 14, 20 units are sold. The company specifically identified that 8 of those had cost $91 and 12 had cost $106 for a total cost of goods sold of $2,000. Inventory available now consists of 5 units costing $500 (or $2,500 - $2,000).On August 17, 20 units costing $2,300 are purchased. Inventory available now consists of25 units costing $2,800 (or $500 + $2,300).On August 28, another 10 units costing $1,190 are purchased. Inventory available now consists of 35 units costing $3,990 (or $2,800 + $1,190).On August 31, 23 units are sold. The company specifically identified that 2 of those cost $91, 3 of those cost $106, 15 of those cost $115, and 3 cost $119, for a total cost of goods sold of $2,582. Inventory available now consists of 12 units costing 1,408 (or $3,990 - $2,582).
The first-in, first-out (FIFO)method of assigning costs to both inventory and cost of goods sold assumes that inventory items are sold in the order acquired. When sales occur, the costs of the earliest units acquired are charged to cost of goods sold. This leaves the costs from the most recent purchases in ending inventory. Applying FIFO, we can prepare a table to determine the

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