Connect Financial bookkeeping Chapter 5

Q1. Walberg Associates, neck dealers, purchase the materials of one estate for $37,700. Regards to the purchase were FOB shipping point, and also the price of carrying the products to Walberg Associates’s warehouse was $1,300. Walberg Associates insured the delivery at a expense of $170. Before putting the items up for sale, castle cleaned and refurbished them at a expense of $510.

You are watching: Laker company reported the following january purchases and sales data for its only product

Determine the price of the inventory acquired from the estate.

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Q2. Laker agency reported the complying with January purchases and also sales data because that its just product.

DateActivitiesUnits obtained at CostUnits marketed at Retail
Jan 1Beginning inventory205 units
$13.00 =$2,665
Jan 10Sales165 units
$22.00
Jan 20Purchase140 units
$12.00 =1,680
Jan 25Sales145 units
$22.00
Jan 30Purchase310 units
$11.50=3,565
Totals655 units$7,910310 units

The firm uses a perpetual perform system. For specific identification, finishing inventory consists of 345 units, whereby 310 are from the January 30 purchase, 5 are from the January 20 purchase, and 30 are from start inventory.

1. Complete the table to recognize the price assigned to finishing inventory and cost of items sold using details identification.

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2. Identify the cost assigned to ending inventory and to expense of items sold using weighted average.

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3. Determine the expense assigned to finishing inventory and also to expense of products sold using FIFO.

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4. Identify the expense assigned to ending inventory and to expense of goods sold making use of LIFO.

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Q3. Hemming Co. Reported the following current-year purchases and also sales for its only product.

DateActivitiesUnits obtained at CostUnits offered at Retail
Jan 1Beginning inventory225 units
$11.00=$2,475
Jan 10Sales150 units
$41.00
Mar 14Purchase340 units
$16.00=5,440
Mar 15Sales300 units
$41.00
July 30Purchase425 units
$21.00=8,925
Oct 5Sales390 units$41.00
Oct 26Purchase125 units
$26.00=3,250
Totals1,115 units$20,090845 units

Hemming uses a periodic inventory system.

a. Determine the expenses assigned to ending inventory and to expense of items sold making use of FIFO.

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b. Determine the expenses assigned to ending inventory and to cost of items sold using LIFO.

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c. Compute the pistol margin for each method.

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Connect Financial accounting Chapter 5 Quiz

Q1. Usage the adhering to information for Davis company to compute perform turnover for Year 2.

Year 2Year 1
Cost of goods sold279,500291,800
Ending inventory47,70049,350
5.865.765.6711.775.89

Q2. Eastview company uses a perpetual LIFO perform system, and also has the adhering to purchases and also sales:

January 1150 units were purchased at $9 every unit.
January 17120 systems were sold.
January 20160 devices were purchased at $11 every unit.
January 29150 systems were sold.

What is the worth of finishing inventory?

$2,730$2,750$2,670$440$380

Q3. Acceptable approaches of assigning details costs come inventory and also cost of products sold include every one of the complying with except:

LIFO method.FIFO method.Specific identification method.Weighted average method.Retail method.

Q4. Hull company reported the complying with income statement information for the present year:

Sales$410,000
Cost of items sold:
Beginning inventory$132,000
Cost of products purchased273,000
Cost of goods obtainable for sale405,000
Ending inventory144,000
Cost of items sold261,000
Gross profit$149,000

The beginning inventory balance is correct. However, the ending inventory number was exaggeration by $20,000. Offered this information, the exactly gross profit would certainly be:

$149,000$169,000$129,000$142,000$112,000

Q5. The understatement of the finishing inventory balance causes:

Cost of items sold to it is in overstated and net revenue to be understated.Cost of products sold to it is in overstated and net revenue to be overstated.Cost of items sold to be understated and also net income to be understated.Cost of goods sold to be understated and also net revenue to it is in overstated.Cost of products sold to be overstated and net earnings to be correct.

Q6. Monarch firm uses a weighted-average perpetual inventory system, and has the complying with purchases and also sales:

January 120 units were purchased in ~ $10 per unit.
January 1212 devices were sold.
January 2018 devices were purchased in ~ $11 every unit.

What is the worth of finishing inventory? (Round average expense per unit come 2 decimal places.)

$278$272$126$398$120

Q7. Grays firm has list of 10 units at a price of $10 every on respectable 1. On respectable 3, it purchased 20 devices at $12 each. 12 devices are offered on respectable 6. Using the FIFO perpetual list method, what amount will be report as price of items sold for the 12 devices that to be sold?

$120$124$128$130$140

Q8. A company had the following purchases and also sales during its very first year that operations:

PurchasesSales
January:10 devices at $1206 units
February:20 units at $1255 units
May:15 systems at $1309 units
September:12 systems at $1358 units
November:10 devices at $14013 units

On December 31, there to be 26 units staying in ending inventory. Making use of the periodic FIFO perform valuation method, what is the price of the finishing inventory? (Assume all sales to be made ~ above the last day of the month.)

$3,405$3,200$3,445$3,540$3,270

Q9. If a period-end inventory lot is report in error, it can reason a misstatement in all of the adhering to except:

Cost of items sold.Gross profit.Net sales.Current assets.Net income.

Q10. Salmone firm reported the adhering to purchases and sales of its just product. Salmone uses a perpetual list system. Identify the cost assigned to price of products sold utilizing FIFO.

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DateActivitiesUnits obtained at CostUnits offered at Retail
May 1Beginning Inventory150 units
$21.00
$2,980$2,460$2,850$2,590$5,440

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