Hemming Co. reported the following current-year purchases and sales for its only product. Date Activities Units Acquired at Cost Units...
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Hemming Co. reported the following current-year purchases andsales for its only product.
Date Activities Units Acquired at Cost Units Sold at Retail Jan. 1 Beginning inventory 250 units @ $12.00 = $ 3,000 Jan. 10 Sales 200 units @ $42.00 Mar. 14 Purchase 400 units @ $17.00 = 6,800 Mar. 15 Sales 360 units @ $42.00 July 30 Purchase 450 units @ $22.00 = 9,900 Oct. 5 Sales 420 units @ $42.00 Oct. 26 Purchase 150 units @ $27.00 = 4,050 Totals 1,250 units $ 23,750 980 units
Required:
Hemming uses a perpetual inventory system.
1. Determine the costs assigned to endinginventory and to cost of goods sold using FIFO.
2. Determine the costs assigned to endinginventory and to cost of goods sold using LIFO.
3. Compute the gross margin for FIFO method andLIFO method.
Perpetual FIFO and LIFO Table: Goods Purchased Cost of Goods Sold Inventory Balance Date # of units Cost per unit # of units sold Cost per unit Cost of Goods Sold # of units Cost per unit Inventory Balance January 1 250 @ $12.00 = $3,000.00 January 10 March 14 March 15 July 30 October 5 October 26 Totals $0.00
Hemming Co. reported the following current-year purchases andsales for its only product.
| Date | Activities | Units Acquired at Cost | Units Sold at Retail | |||||||||||||
| Jan. | 1 | Beginning inventory | 250 | units | @ $12.00 | = | $ | 3,000 | ||||||||
| Jan. | 10 | Sales | 200 | units | @ $42.00 | |||||||||||
| Mar. | 14 | Purchase | 400 | units | @ $17.00 | = | 6,800 | |||||||||
| Mar. | 15 | Sales | 360 | units | @ $42.00 | |||||||||||
| July | 30 | Purchase | 450 | units | @ $22.00 | = | 9,900 | |||||||||
| Oct. | 5 | Sales | 420 | units | @ $42.00 | |||||||||||
| Oct. | 26 | Purchase | 150 | units | @ $27.00 | = | 4,050 | |||||||||
| Totals | 1,250 | units | $ | 23,750 | 980 | units | ||||||||||
Required:
Hemming uses a perpetual inventory system.
1. Determine the costs assigned to endinginventory and to cost of goods sold using FIFO.
2. Determine the costs assigned to endinginventory and to cost of goods sold using LIFO.
3. Compute the gross margin for FIFO method andLIFO method.
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