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Keats Office Supplies FIFO perpetual inventory

Price: $2.50


The beginning inventory at Keats Office Supplies and data on purchases and sales for a
three-month period are as follows:

Date Transaction # of units Per Unit Total
Mar. 1 Inventory 300 20 6,000
10 Purchase 500 21 10,500
28 Sale 400 35 14,000
30 Sale 250 40 10,000
Apr. 5 Sale 80 40 3,200
10 Purchase 450 22 9,900
16 Sale 250 42 10,500
28 Sale 150 45 6,750
May 5 Purchase 175 24 4,200
14 Sale 160 50 8,000
25 Purchase 150 25 3,750
30 Sale 140 50 7,000

Instructions
1. Record the inventory, purchases, and cost of merchandise sold data in a perpetual inventory
record similar to the one illustrated in Exhibit 3, using the first-in, first-out method.
2. Determine the total sales and the total cost of merchandise sold for the period. Journalize
the entries in the sales and cost of merchandise sold accounts. Assume that all
sales were on account.
3. Determine the gross profit from sales for the period.
4. Determine the ending inventory cost.
5. Based upon the preceding data, would you expect the inventory using the last-in,
first-out method to be higher or lower?

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