Oct 3 3000 8 10 oct 9 3500 9 11 during october 11400

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Oct. 3 3,000 @ $8 Oct. 19 3,000 @ $10 Oct. 9 3,500 @ $9 Oct. 25 3,500 @ $11 During October, 11,400 units were sold. Soul Patrol uses a periodic inventory system. Instructions (a) Determine the cost of goods available for sale. (b) Determine (1) the ending inventory and (2) the cost of goods sold under each of the assumed cost flow methods (FIFO, LIFO, and average-cost). Prove the accuracy of the cost of goods sold under the FIFO and LIFO methods. (c) Which cost flow method results in (1) the highest inventory amount for the balance sheet and (2) the highest cost of goods sold for the income statement? P6-3B Lobster Company had a beginning inventory on January 1 of 150 units of Product BU-54 at a cost of $20 per unit. During the year, the following purchases were made. Mar. 15 400 units at $23 Sept. 4 350 units at $26 July 20 250 units at $24 Dec. 2 100 units at $29 1,000 units were sold. Lobster Company uses a periodic inventory system. Determine items and amounts to be recorded in inventory. (SO 1) Determine cost of goods sold and ending inventory using FIFO, LIFO, and average-cost with analysis. (SO 2, 3) (b)(2) Cost of goods sold: FIFO $98,500 LIFO $111,200 Average $104,880 Determine cost of goods sold and ending inventory, using FIFO, LIFO, and average-cost with analysis. (SO 2, 3) PDF Watermark Remover DEMO : Purchase from to remove the watermark
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292 Chapter 6 Inventories Instructions (a) Determine the cost of goods available for sale. (b) Determine (1) the ending inventory,and (2) the cost of goods sold under each of the assumed cost flow methods (FIFO, LIFO, and average-cost). Prove the accuracy of the cost of goods sold under the FIFO and LIFO methods. (c) Which cost flow method results in (1) the highest inventory amount for the balance sheet, and (2) the highest cost of goods sold for the income statement? P6-4B The management of Moner Inc. is reevaluating the appropriateness of using its present inventory cost flow method, which is average-cost.The company requests your help in determin- ing the results of operations for 2010 if either the FIFO or the LIFO method had been used. For 2010 the accounting records show these data: Purchases were made quarterly as follows. Inventories Purchases and Sales Beginning (8,000 units) $16,000 Total net sales (180,000 units) $747,000 Ending (18,000 units) Total cost of goods purchased (190,000 units) 468,000 Quarter Units Unit Cost Total Cost 1 50,000 $2.20 $110,000 2 40,000 2.40 96,000 3 40,000 2.50 100,000 4 60,000 2.70 162,000 190,000 $468,000 Operating expenses were $130,000, and the company’s income tax rate is 40%. Instructions (a) Prepare comparative condensed income statements for 2010 under FIFO and LIFO. (Show computations of ending inventory.) (b) Answer the following questions for management. (1) Which cost flow method (FIFO or LIFO) produces the more meaningful inventory amount for the balance sheet? Why? (2) Which cost flow method (FIFO or LIFO) produces the more meaningful net income? Why?
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