Chapter 7: Inventories
PE 7-1A: Calculate the November gross revenue and the November 30-ending stock using the following methods: (a) First-in/First-out (FIFO), (b) Last-in/First-Out (LIFO); and (c). Weighted common prices strategies.
|
Information |
FIFO |
LIFO |
WAC Method |
|
Price of the Goods Sold |
Nov 2http://nd.: 55 |
Nov 28Th: 62 |
Average: (55+57+62) ÷ 3 = 58 |
|
The End |
174 – 55 = 119 |
174 -62 = 112 |
58× 2 = 116 |
|
Nov. 30Th Sales |
90 |
90 |
90 |
|
Gross Profit = (Sales – Cost of Goods Sold) |
90 – 55 = 35 |
90 – 62 = 28 |
90 – 58 = 32 |
PE 7 – 4A: Perpetual
utilizing Weighted Average
- a) . Weighted Average Unit Cost after May 23rd Buy
| 15 items starting from $80 | $1,200 |
| 60 Items starting at $90 | $5,400 |
| Total :75 products | $6,600 |
Weighted Average Cost = $6,600 ÷ 75 = $88
b). Cost of Merchandise Purchased May 26
55 items × $88 = $4,840
c).
On May 31,
in items: (50 + 60) – (35 + 55) = 20
price = 20 × 88 = $1,760
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