Hurst Companys beginning inventory and purchases during the fiscal year ended December 31, 20-2, were as follows:
Question:
Hurst Company’s beginning inventory and purchases during the fiscal year ended December 31, 20-2, were as follows:
REQUIRED
1. Calculate the total amount to be assigned to the cost of goods sold for 20-2 and ending inventory on December 31 under each of the following periodic inventory methods:
(a) FIFO
(b) LIFO
(c) Weighted-average (round calculations to two decimal places)
2. Assume that the market price per unit (cost to replace) of Hurst’s inventory on December 31 was $18. Calculate the total amount to be assigned to the ending inventory on December 31 under each of the following methods:
(a) FIFO lower-of-cost-or-market
(b) Weighted-average lower-of-cost-or-market
3. In addition to taking a physical inventory on December 31, Hurst decides to estimate the ending inventory and cost of goods sold. During the fiscal year ended December 31, 20-2, net sales of $100,000 were made at a normal gross profit rate of 35%. Use the gross profit method to estimate the cost of goods sold for the fiscal year ended December 31 and the inventory on December 31.
Accounting
ISBN: 978-0324662962
23rd Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren