LoBianco Company's record of transactions for the month of April was as follows. Purchases Sales April...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
LoBianco Company's record of transactions for the month of April was as follows. Purchases Sales April 1 (balance on hand) 600 @ S6.00 April 3 500 @ $10.00 4 1,500 @6.08 9 1,300 @ 10.00 800 @ 6.40 11 600 @ 11.00 13 1,200 @ 6.50 23 1,200 @ 11.00 21 700 @ 6.60 27 900 @ 12.00 29 500 @ 6.79 4,500 5.300 Instructions (Round unit price averages to four decimal places.) a. Assuming that periodic inventory records are kept, compute the inventory at April 30 using (1) FIFO and (2) average-cost. b. Assuming that perpetual inventory records are kept in both units and dollars, determine the inventory at April 30 using (1) FIFO and (2) average-cost. c. In an inflationary period, which inventory method-FIFO or average-cost-will show the highest net income? Purchases Sales Apr-01 (balance on hand) 600 6.00 Apr-01 500 10.00 Apr-04 1500 6.08 Apr-09 1300 e s 10.00 Apr-08 Apr-13 Аpr-11 Аpr-23 Apr-27 800 6.40 600 11.00 e s e s 1200 6.50 1200 11.00 Apr-21 Apr-29 700 6.60 900 12.00 500 6.79 5300 4500 Purchases 5300 Less:Sales -4500 Inventory 800 FIFO method: 300 x $ 6.60 $1,980.00 500 x $ 6.79 $3,395.00 800 $5,375.00 Average Method Average cost per unit = $6.35 as follows Units Cost per Total unit @ $ 6.00 = $ 3,600.00 @ $ 6.08 = $ 9,120.00 600 1500 800 6.40 = $ 5,120.00 1200 e $ 6.50 = $ 7,800.00 700 @ $ 6.60 = $ 4,620.00 500 @ $ 6.79 = $ 3,395.00 5300 $ 6.35 $3,655.00 Inventory 800 e $ 6.35 = $ 5,080.00 Under FIFO inventory is $5375.00 where as Average method it was $5080.00, hence closing stock under FIFO is high and hence income under FIFO method is high LoBianco Company's record of transactions for the month of April was as follows. Purchases Sales April 1 (balance on hand) 600 @ S6.00 April 3 500 @ $10.00 4 1,500 @6.08 9 1,300 @ 10.00 800 @ 6.40 11 600 @ 11.00 13 1,200 @ 6.50 23 1,200 @ 11.00 21 700 @ 6.60 27 900 @ 12.00 29 500 @ 6.79 4,500 5.300 Instructions (Round unit price averages to four decimal places.) a. Assuming that periodic inventory records are kept, compute the inventory at April 30 using (1) FIFO and (2) average-cost. b. Assuming that perpetual inventory records are kept in both units and dollars, determine the inventory at April 30 using (1) FIFO and (2) average-cost. c. In an inflationary period, which inventory method-FIFO or average-cost-will show the highest net income? Purchases Sales Apr-01 (balance on hand) 600 6.00 Apr-01 500 10.00 Apr-04 1500 6.08 Apr-09 1300 e s 10.00 Apr-08 Apr-13 Аpr-11 Аpr-23 Apr-27 800 6.40 600 11.00 e s e s 1200 6.50 1200 11.00 Apr-21 Apr-29 700 6.60 900 12.00 500 6.79 5300 4500 Purchases 5300 Less:Sales -4500 Inventory 800 FIFO method: 300 x $ 6.60 $1,980.00 500 x $ 6.79 $3,395.00 800 $5,375.00 Average Method Average cost per unit = $6.35 as follows Units Cost per Total unit @ $ 6.00 = $ 3,600.00 @ $ 6.08 = $ 9,120.00 600 1500 800 6.40 = $ 5,120.00 1200 e $ 6.50 = $ 7,800.00 700 @ $ 6.60 = $ 4,620.00 500 @ $ 6.79 = $ 3,395.00 5300 $ 6.35 $3,655.00 Inventory 800 e $ 6.35 = $ 5,080.00 Under FIFO inventory is $5375.00 where as Average method it was $5080.00, hence closing stock under FIFO is high and hence income under FIFO method is high
Expert Answer:
Answer rating: 100% (QA)
Required solution of all 3 parts is given below Part A FIFO Cost of goods sold FIFO Units Unit cost ... View the full answer
Related Book For
Accounting
ISBN: 978-0324662962
23rd Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren
Posted Date:
Students also viewed these accounting questions
-
15. Which of the following are NOT angular movements? MARK TWO that apply. a. flexion b. gliding c. abduction d. circumduction e. supination Articulations a. Table (4 points) Specific joint Between...
-
Question 5 (1 point) Evaluate f(3,847) to 4 decimal places given that f(x) = log(x). Your Answer: Answer Question 6 (1 point) Evaluate f(38,141) to 4 decimal places given that f(x)= In(x). Your...
-
Which of the following activity bases would best be used to allocate setup activity to products? a. Number of inspections b. Direct labor hours c. Direct machine hours d. Number of production runs
-
A pharmaceutical company manufactures a particular brand of antihistamine tablets. In the quality control division, certain tests are routinely performed to determine whether the product being...
-
The following table summarizes the number of deceased beetles under autolysis (the destruction of a cell after its death by the action of its own enzymes) and putrefaction (decomposition of organic...
-
IndiGo is a low-cost airline headquartered at Gurgaon, India. It is the largest airline in India in terms of passengers carried, with a 42.6% market share as of October 2016. The airline was founded...
-
Blubaugh was a district manager of Schlumberger Well Services. Turner was an executive employee of Schlumberger. Blubaugh was told that he would be fired unless he chose to resign. He was also told...
-
The Caf Food and Beverage Expenses Essendon includes: 75% of expenses related to food 25% of expenses related to beverages. To calculate the portion of expenses related to food, multiply the total...
-
The chairperson of the department of management at State University wants to forecast the number of students who will enroll in production and operations management (POM) next semester, in order to...
-
Brian and Damon sent an email to experienced cruisers that describes how Green Ocean cruises are more "relaxing" than traditional ones. This email failed to generate the response rate they were...
-
The following features are advertised by SAGE as being available within its job costing software module. Is this right for me? l Keep track of job-specific information including job and customer...
-
Compare the control account of Table 7.5 with the wages account of Table 7.3 to satisfy yourself that they are the same. Then satisfy yourself that the separate job accounts in Table 7.5 add up to...
-
Clorox is the global leader in the production of bleach. Clorox also makes laundry and cleaning items (Formula 409, Pine-Sol, Tilex), cat litter (Fresh Step), car-care products (Armor All, STP), the...
-
Reducing heat production costs The main markets for New Zealands forest industry are either dry or treated timber. In both cases heat energy is required. This heat demand comprises the larger part of...
-
Compare the control account of Table 7.7 with the work-in-progress account of Table 7.3 to satisfy yourself that they are the same. Then satisfy yourself that the separate job accounts in Table 7.7...
-
Southeast Soda Pop, Inc., has a new fruit drink for which it has high hopes. John Mittenthal, the production planner, has assembled the following demand forecast: Q1 1,800, Q2 1,100, Q3 1,600, Q4 900...
-
Reconsider Prob. 1474. In order to drain the tank faster, a pump is installed near the tank exit as in Fig. P1475. Determine how much pump power input is necessary to establish an average water...
-
Boeing is one of the worlds major aerospace firms, with operations involving commercial aircraft, military aircraft, missiles, satellite systems, and information and battle management systems. As of...
-
Cardio Care Inc. manufactures stationary bicycles and rowing machines. The products are produced in the Fabrication and Assembly production departments. In addition to production activities, several...
-
What are the disadvantages of a partnership over a limited liability company form of organization for a profit-making business?
-
Dee commenced in self-employment on 6 April 2021. She initially prepared accounts to 5 April, but changed her accounting date to 31 July by preparing accounts for the four- month period to 31 July...
-
Stephen is a UK resident taxpayer with two different sources of income. He works part time as an IT consultant for a small number of clients, on a project management basis. A separate contract is...
-
Roseanne is a Scottish taxpayer. She starts trading on 1 July 2023 and prepares accounts for the 16 months to 31 October 2024. The adjusted trading profit for this period is 38,560. Her only other...
Crypto Essentials A Comprehensive Guide For Beginners 1st Edition - ISBN: 979-8865557333 - Free Book
Study smarter with the SolutionInn App