- 401 Views
- Uploaded on

Download Presentation
## PowerPoint Slideshow about 'Home Work #6' - adamdaniel

**An Image/Link below is provided (as is) to download presentation**

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.

- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -

Presentation Transcript

### Home Work #6

Dr. Yan Xiong

1. Invoice price of goods is $5000. Purchase terms are 2/10, n/30 and the invoice is paid in the week of receipt. The shipping terms are FOB shipping point and the shipping cost is $200.

($5,000 0.98) + $200 = $5,100

2. Invoice price of goods is $3000. Purchase terms are 4/10, n/30 and the invoice is paid in the week of receipt. The shipping terms are FOB destination and the shipping cost is $250.

($3,000 0.96) = $2,880

3. Invoice price of goods is $2500. Purchase terms are 2/10, n/30 and the invoice is paid 15 days after receipt. The shipping terms are FOB shipping point and the shipping cost is $250.

$2,500 + $250 = $2,750

4. Invoice price of goods is $9000. Purchase terms are 3/10, n/30 and the invoice is paid in the week of receipt. The shipping terms are FOB destination and the shipping cost is $200.

$9,000* 0.97 = $8,730

1/5 Purchased 40 units @ $100 each

- 2/15 Sale 15 units @ $150 each
- 4/10 Sale 10 units @ $150 each
- 6/30 Purchased 30 units @ $105 each
- 8/15 Sale 25 units @ 150 each
- 11/28 Purchased 20 units @ $110 each

Calculate Ending Inventory and Cost of Goods

Sold under

1-FIFO perpetual

2-FIFO periodic

3-LIFO perpetual

4-LIFO periodic

5. Weighted-average (periodic)

FIFO perpetual

CGS: (15*$100) + (10* $100) + (15 *$100) + (10* $105)

= $5,050

EI: (20 $105) + (20 $110) = $4,300

GM: Sales $7,500 – CGS $5,050 = GM $2,450

FIFO periodic

CGS: (40 $100) + (10 $105) = $5,050

EI: (20 $105) + (20 $110) = $4,300

GM: Sales $7,500 – CGS $5,050 = GM $2,450

LIFO perpetual

CGS: (15*$100) + (10* $100) + (25 *$105)

= $5,125

EI: (5 *$105) + (20 *$110)+ (15*100) = $4225

GM: Sales $7,500 – CGS $5,125= GM $2,375

LIFO periodic

CGS: (20 $110) + (30 $105) = $5,350

EI: 40 $100 = $4,000

GM: Sales $7,500 – CGS $5,350 = GM $2,150

Weighted-average periodic

Average cost: $9,350/90 = $103.89 (rounded)

EI: 40 $103.89 = $4,156 (90 – 50 = 40)

CGS: 50 $103.89 = $5,194

GM: Sales $7,500 – CGS $5,194 = GM $2,306

Given the following information for G Company for the year ending December 31, 2003.

- Cash amounted to $19,375
- Beginning Inventory was $16,000 (160 units @ $100 each)
- Common Stock was $15,000
- Retained Earnings was $20,375

Transaction during 2003 included:

- The company purchased 150 units @ $110 each for cash
- The company purchased 190 more units @120 each for cash
- Cash sale were $290 units @$200 each
- The company paid $11,500 cash for operating expenses
- The company paid cash for income tax at a rate of 30% of net income.
- Required: a. Compute the cost of good sold and ending inventory using a. FIFO, b. LIFO, and c. weighted average
- b. Prepare the 2003 balance sheets, income statements and statement of cash flow using all three inventory methods.

Beginning Inventory 800 units @ $20 each

- 4/5 Sale 500 units
- 4/15 Purchase 400 units @ $21 each
- 4/20 Purchased 400 units @ $22 each
- 4/27 Sale 400 units
- Required: (Periodic System)
- Calculate the ending inventory using FIFO and LIFO
- Suppose that 100 units were left out of the count of the ending inventory. What effect would that have on the cost of goods sold under each of the cost flow assumption in parts a and b?

Brickey, Inc.: FIFO, LIFO, and inventory errors

a. (300 units @ $21) + (400 units @ $22) = $15,100

b. (700 units @ $20) = $14,000

c. If 100 units were left out using FIFO, then cost of goods sold would increase by 100 *$21 = $2,100.

If 100 units were left out using LIFO, then cost of goods sold would increase by 100* $20 = $2,000.

Download Presentation

Connecting to Server..