Flounder Inc. is a retailer using a perpetual inventory system. All sales returns from customers result in the goods being returned to inventory. (Assume that the inventory is not damaged.) Assume that there are no credit transactions; all amounts are settled in cash. You are provided with the following information for Flounder Inc. for the month of January.

Date			Description		Quantity				Unit Cost or Selling Price
Dec.	31		Ending inventory			160				$19
Jan.	2		Purchase			100				23
Jan.	6		Sale			180				38
Jan.	9		Sale return			10				38
Jan.	9		Purchase			75				24
Jan.	10		Purchase return			15				24
Jan.	10		Sale			50				45
Jan.	23		Purchase			100				27
Jan.	30		Sale			120				51

(a)

Using FIFO method, calculate (i) cost of goods sold, (ii) ending inventory, and (iii) gross profit. (Assume sales returns had a cost of $19 and purchase returns had a cost of $24.)

Cost of goods sold		$
Ending Inventory		$
Gross Profit		$

Answer rating: 100% (QA)

FIFO method Calculation of ending inventory in units Opening inventory Pur... View the full answer