View the step-by-step solution to:

The purchases and issues of rubber gaskets (Materials Ledger #11216) as shown in the records of GT Corp. for November follow: Required:

This question was answered on Jan 27, 2013. View the Answer
The purchases and issues of rubber gaskets (Materials Ledger #11216) as shown in the records of GT Corp. for November follow:


Required:
1. Complete a materials ledger account similar to Figure 2-10 (the "On Order" columns should be omitted) for each of the following inventory costing methods, using a perpetual inventory system:
a. FIFO Costing:
Materials Ledger
Description Rubber gaskets Materials Ledger Account No. 11216
Received Issued Balance
Date Rec. Rep. No. Quantity Unit Price Amount Mat.Req. No. Quantity Unit Price Amount Quantity Unit Price Amount
11/1
11/4

11/5
11/8

11/15

11/22

11/28

b. LIFO Costing:
Materials Ledger
Description Rubber gaskets Materials Ledger Account No. 11216
Received Issued Balance
Date Rec. Rep. No. Quantity Unit Price Amount Mat.Req. No. Quantity Unit Price Amount Quantity Unit Price Amount
11/1
11/4

11/5

11/8

11/15

11/22


11/28


c. Moving Average Costing: (for this requirement, if necessary, carry unit prices to five decimal places and use that rounded figure in subsequent computations)
Materials Ledger
Description Rubber gaskets Materials Ledger Account No. 11216
Received Issued Balance
Date Rec. Rep. No. Quantity Unit Price Amount Mat.Req. No. Quantity Unit Price Amount Quantity Unit Price Amount
11/1
11/4
11/5
11/8
11/15
11/22
11/28
2. For each method, prepare a schedule that shows the total cost of materials transferred to Work in Process and the cost of the ending inventory. Round all numbers to the nearest dollar.
Inventory Method Cost Transferred to Work in Process Cost of Ending Inventory
FIFO $ $
LIFO $ $
Moving average $ $
3. If prices continue to increase, would you favor adopting the FIFO or the LIFO method? Explain.
The input in the box below will not be graded, but may be reviewed and considered by your instructor.

4. When prices continue to rise, what is the effect of FIFO versus LIFO on the inventory balance for materials reported in the balance sheet?

Discuss.
The input in the box below will not be graded, but may be reviewed and considered by your instructor.

Sign up to view the entire interaction

Top Answer

Hi Student, please find... View the full answer

8424661.xlsx

a) First - in, First Out Method
Date Received
Quantity Per Unit Issued
Amount $ Quantity Balance Per Unit Amount $ Quantity Per Unit Amount $ Nov.
1
4 10,000 3.1 31000 5
8 50,000 3.3 165000 30,000...

This question was asked on Jan 26, 2013 and answered on Jan 27, 2013.

Recently Asked Questions

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors and customizable flashcards—available anywhere, anytime.

-

Educational Resources
  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access or to earn money with our Marketplace.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question
  • -

    Flashcards

    Browse existing sets or create your own using our digital flashcard system. A simple yet effective studying tool to help you earn the grade that you want!

    Browse Flashcards