Question: Hamada Hand Tools Inc HHT had the following transactions related

Hamada Hand Tools, Inc. (HHT) had the following transactions related to purchases and sales of merchandise for the last month. The selling price of hand tools was $80 each, with a credit term of 2/10, n/30. All purchases were on credit, with a term of 2/10, n/30.
May 2 Purchased 30 hand tools at $45 each.
May 6 Sold 15 hand tools to CAT Construction, Inc.
May 10 Purchased 25 hand tools at $42 each.
May 14 Sold 20 hand tools to Max Tools.
May 16 Max Tools returned 2 hand tools to HHT.
May 18 Sold 12 hand tools to Parker Co.
May 22 Purchased 40 hand tools at $44 each.
May 27 Sold 25 hand tools to Bibby Co.
On May 1, HHT had 10 hand tools in inventory, with a total cost of $480.
Requirements
1. Calculate the ending inventory and cost of goods sold using a perpetual inventory system:
(a) FIFO
(b) Average cost
2. Calculate the ending inventory and cost of goods sold using a periodic inven¬tory system:
(c) FIFO
(d) Average cost
3. Prepare the journal entries using a perpetual inventory system:
(a) FIFO
(b) Average cost
4. Calculate the ending inventory and cost of goods sold, assuming HHT is using the specific-identification method. HHT provided the following additional information:
• May 6 sale: all units were taken from the May 2 purchase.
• May 14 sale: 10 units were taken from the beginning inventory and 10 units from the May 10 purchase
• May 16 sales return: 2 units were returned to the beginning inventory cost
• May 18 sale: all units were taken from the May 10 purchase
• May 27 sale: all units were taken from the May 22 purchase

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  • CreatedJuly 08, 2015
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