3 b hi tech are retailers who sell scientific

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- 3 - b)Hi-Techare retailers who sell scientific calculators and use the FIFO method to value inventory. During the second quarter (April to June) of 20X9, they decided to concentrate their selling activities on the "Casio fx 6300G" model, which experienced several cost fluctuations during the period. The company began the quarter with 50 calculators with a unit cost of $4,000. The following transactions took place during the quarter. April 10 200 calculators were purchased at a cost of $4,050 each but in addition there was a freight charge of $90 as well as customs import charge of $150 each. April 30 During the month 180 calculators were sold at a price of $5,250 each. May 1 A new batch of 120 calculators was purchased at a total cost of $612,000. May 28 The sales for May were 120 calculators at a unit selling price of $6,450. June 2 A further 220 calculators were purchased at a cost of $6,200 each and these were subject to a trade discount of 12½% each. June 5 15 of the calculators purchased on June 2 were found to be defective and were returned to the supplier. June 30 225 calculators were sold during June at a price of $6,900 each. Required: i)Prepare the perpetual inventory record for Hi-Tech to determine the value of inventory on hand at June 30, 20X9. ii)Calculate the gross profit earned for the quarter. iii)State the journal entries necessary to record the transactions on April 10 & 30 under the: -perpetual inventory system -periodic inventory system Question 3 Van Dyke Copierinventory data for the year ended December 31, 2008 is as follow: Sales Revenue………………………………………………$50,000 Cost of Goods Sold: Beginning Inventory…………………………..$ 4,200 Net Purchases……………………………………27,400 Cost of Goods Available………………………31,600 Ending Inventory………………………………(4,600) 27,000 Gross Profit…………………………………………………$23,000 a)Assume that ending inventory was accidentally overstatedby $1,000. What are the correct amounts for cost of goods sold and gross profit? b)How would the inventory error affect cost of goods sold and gross profit for the year ended December 31, 2009? Question 4 Shepard Company sold 2,000 units of its product at $108 per unit in 2008 and incurred operating expenses of $14 per unit in selling the units. It began the year with 840 units in inventory and made successive purchases of its product as follows:
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- 4 - January 2 Beginning Inventory…………..840 units @ $58 per unit April 2 Purchase …………………………..600 units @ $59 per unit June 14 Purchase …………………………..500 units @ $61 per unit August 29 Purchase …………………………..700 units @ $64 per unit November 18 Purchase …………………………..900 units @ $65 per unit Total 3,540 units Shepard Company uses a periodicinventory system. i)Determine the ending inventory and cost of goods sold amounts for the December financial statement under the FIFO, LIFO and average-cost methods. ii)Prepare comparative income statements for the three inventory costing methods. iii)How would the financial results from using the three alternative inventory costing methods change if Shepard had been experiencing decreasing prices in its purchases of inventory? Question 5

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