Determine the gross profit using the weighted average cost flow method, assuming that only one item was
Question:
Determine the gross profit using the weighted average cost flow method, assuming that only one item was sold on March 24 for $14.
Date | Item | Units | Cost | Total |
March 3 | Purchase | 1 | $4 | $4 |
March 8 | Purchase | 1 | 6 | 6 |
March 22 | Purchase | 1 | 8 | 8 |
Total | 3 | $18 |
a.$8
b.$4
c.$6
d.$14
The specific identification inventory method cannot be used.
a. when all units sold are alike.
b. when each inventory unit can be specifically identified.
c. when the unit sold is identified with a specific purchase.
d.by an automobile dealer where automobiles have unique serial numbers.
The inventory subsidiary ledger is not used
a.to keep track of purchases discounts.
b.to keep track of inventory purchased.
c.to keep track of inventory sold.
d.to keep track of proper inventory maximum and minimum levels.
Determine the gross profit using the periodic inventory system and the FIFO inventory method, assuming that 18 units were sold at a sales price of $14.
Date | Item | Units | Cost | Total |
January 1 | Beginning inventory | 5 | $3 | $15 |
January 12 | Purchase | 10 | 4 | 40 |
January 18 | Purchase | 8 | 5 | 40 |
Totals | 23 | $95 |
a.$80
b.$252
c.$182
d.$95
Determine the value of the inventory at the lower of cost or market, assuming LCM is applied individually to each item.
Item | Inventory Quantity | Cost per Unit | Market Value per Unit (Net Realizable Value) |
S | 3 | $34 | $30 |
T | 2 | 28 | 30 |
a.$102
b.$158
c.$146
d.$150
Financial and Managerial Accounting
ISBN: 978-0538480895
11th Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren