Question :
50) Inventory data for Army & Navy Wear Co. provided : 1253243
50) Inventory data for Army & Navy Wear Co. are provided below. Sales for the month were 220 units sold for $12 each. The company maintains a periodic inventory system.
Date
Number of Units
Unit Cost
Total Cost
Jan. 01
Beginning inventory
50
$5.00
$ 250
Jan. 15
Purchases
70
$6.00
$ 420
Jan. 20
Purchases
80
$7.00
$ 560
Jan. 27
Purchases
100
$7.50
$ 750
Totals
300
$1,980
Required:
1. Determine the cost of goods sold and ending inventory for the month assuming the company uses the FIFO cost flow method.
2. Determine the cost of goods sold and ending inventory for the month assuming the company uses the LIFO cost flow method.
3. Determine the cost of goods sold and ending inventory for the month assuming the company uses the weighted average method.
4. Which method would you recommend that the company use if its objective is to minimize its income tax liability?
51) Inventory data for Army & Navy Wear Co. are provided below. Sales for the quarter were 220 units sold for $12 each.
Date
Number of Units
Unit Cost
Total Cost
Jan. 01
Beginning inventory
150
$5.00
$ 750
Jan. 15
Purchase
70
$6.00
$ 420
Feb. 01
Sale
100
Feb. 20
Purchase
180
$7.00
$1,260
March 05
Sale
120
March 19
Purchase
50
$7.50
$ 375
Required:
1. Calculate the cost of goods sold for the quarter assuming the company uses a FIFO perpetual inventory system.
2. Calculate the cost of goods sold for the quarter assuming the company uses a LIFO perpetual inventory system.
3. Which system (perpetual or periodic) do you think is increasing in use because of computer technology?
52) The Quiet Gravestone Company has only one product: a large, 3-foot gravestone. Data for inventory during February of the current year are provided below. Assume the company uses a perpetual inventory system and the FIFO cost flow method.
Date
Number of Units
Unit Cost
Total Cost
Feb 01
Beginning inventory
5
$40.00
$200
Feb 04
Purchase
10
$42.00
$420
Feb 10
Purchase
12
$44.00
$528
Feb 18
Purchase
8
$45.00
$360
Feb 25
Purchase
14
$46.00
$644
Sales for the month were:
February 7: seven sold at $1,000
February 15: five sold at $1,050
February 20: ten sold at $1,100
Required:
1. What is the cost of goods sold for the February 7 sale?
2. What is the cost of goods sold for the February 15 sale?
3. What is the cost of goods sold for the February 20 sale?
4. If the company used a periodic inventory system and the FIFO cost flow method, what would cost of goods sold be for the month?
53) The Cemetery Gravestone Company has only one product: a large, 3-foot gravestone. Data for inventory during February of the current year are provided below. Assume the company uses a PERPETUAL inventory system and the LIFO cost flow method.
Date
Number of Units
Unit Cost
Total Cost
Feb 01
Beginning inventory
5
$40.00
$200
Feb 04
Purchase
10
$42.00
$420
Feb 10
Purchase
12
$44.00
$528
Feb 18
Purchase
8
$45.00
$360
Feb 25
Purchase
14
$46.00
$644
Sales for the month were:
February 7: seven sold at $1,000
February 15: five sold at $1,050
February 20: ten sold at $1,100
Required:
1. What is the cost of goods sold for the February 7 sale?
2. What is the cost of goods sold for the February 15 sale?
3. What is the cost of goods sold for the February 20 sale?
4. If the company used a PERIODIC inventory system and the LIFO cost flow method, what would the cost of goods sold be for the month?
