Project #75088 - accounting

At the beginning of November, Yoshi Inc.’s inventory consists of 61 units with a cost per unit of $96. The following transactions occur during the month of November.

 

 

November 2

Purchase 79 units of inventory on account from Toad Inc. for $100 per unit, terms 1/10, n/30.

November 3

Pay freight charges related to the November 2 purchase, $130.

November 9

Return 14 defective units from the November 2 purchase and receive credit.

November 11

Pay Toad Inc. in full.

November 16

Sell 100 units of inventory to customers on account, $12,900. [Hint: The cost of units sold from the November 2 purchase includes $100 unit cost plus $2 per unit for freight less $1 per unit for the purchase discount, or $101 per unit.]

November 20

Receive full payment from customers related to the sale on November 16.

November 21

Purchase 59 units of inventory from Toad Inc. for $106 per unit, terms 3/10, n/30.

November 24

Sell 70 units of inventory to customers for cash, $11,900.

 

 

Required:

1.

Assuming that Yoshi Inc. uses a FIFO perpetual inventory system to maintain its internal inventory records, record the transactions.

2.

Assuming for preparing financial statements that Yoshi Inc. reports inventory using LIFO, record the LIFO adjustment.

3-Suppose by the end of November that the remaining inventory is estimated to have a market value per unit of $82, record any necessary adjustment for the lower-ofcost-or-market method after the LIFO adjustment.

 

 

4-Prepare the top section of the multiple-step income statement through gross profit for the month of November after the lower-of-cost-or-market adjustment.

 

 

5-Pete’s Tennis Shop has the following transactions related to its top-selling Wilson tennis racket for the month of August 2015. Pete’s Tennis Shop uses a periodic inventory system

 

  Date Transactions Units Cost per
Unit
Total Cost
  August 1 Beginning inventory 8     $144       $ 1,152     
  August 4 Sale ($145 each) 5          
  August 11 Purchase 10     134         1,340     
  August 13 Sale ($160 each) 8          
  August 20 Purchase 10     124         1,240     
  August 26 Sale ($170 each) 11          
  August 29 Purchase 11     114         1,254     
       

        $ 4,986    
       




4-Using FIFO, calculate ending inventory and cost of goods sold at August 31, 2015.

Using LIFO, calculate ending inventory and cost of goods sold at August 31, 2015.

Using weighted-average cost, calculate ending inventory and cost of goods sold at August 31, 2015

Calculate sales revenue and gross profit under each of the four methods

If Pete’s chooses to report inventory using LIFO, record the LIFO adjustment.

 

Subject Business
Due By (Pacific Time) 06/28/2015 08:00 am
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