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[The following information applies to the questions displayed below.] Hemming Co. reported the following current-year purchases and sales for its only product.
Date Activities Units Acquired at Cost Units Sold at Retail Jan. 1 Beginning inventory 215 units @ $10.60 = $ 2,279 Jan. 10 Sales 180 units @ $40.60 Mar. 14 Purchase 320 units @ $15.60 = 4,992 Mar. 15 Sales 260 units @ $40.60 July 30 Purchase 415 units @ $20.60 = 8,549 Oct. 5 Sales 400 units @ $40.60 Oct. 26 Purchase 115 units @ $25.60 = 2,944 Totals 1,065 units $ 18,764 840 units
Required: Hemming uses a periodic inventory system. (a) Determine the costs assigned to ending inventory and to cost of goods sold using FIFO.
(b) Determine the costs assigned to ending inventory and to cost of goods sold using LIFO.
(c) Compute the gross margin for each method.
Required information
[The following information applies to the questions displayed below.] Hemming Co. reported the following current-year purchases and sales for its only product.
| Date | Activities | Units Acquired at Cost | Units Sold at Retail | |||||||||||||
| Jan. | 1 | Beginning inventory | 215 | units | @ $10.60 | = | $ | 2,279 | ||||||||
| Jan. | 10 | Sales | 180 | units | @ $40.60 | |||||||||||
| Mar. | 14 | Purchase | 320 | units | @ $15.60 | = | 4,992 | |||||||||
| Mar. | 15 | Sales | 260 | units | @ $40.60 | |||||||||||
| July | 30 | Purchase | 415 | units | @ $20.60 | = | 8,549 | |||||||||
| Oct. | 5 | Sales | 400 | units | @ $40.60 | |||||||||||
| Oct. | 26 | Purchase | 115 | units | @ $25.60 | = | 2,944 | |||||||||
| Totals | 1,065 | units | $ | 18,764 | 840 | units | ||||||||||
| | ||||||||||||||||
Required: Hemming uses a periodic inventory system. (a) Determine the costs assigned to ending inventory and to cost of goods sold using FIFO.
(b) Determine the costs assigned to ending inventory and to cost of goods sold using LIFO.
(c) Compute the gross margin for each method.
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