Perpetual inventory usingFIFO

Beginning inventory, purchases, and sales for Item Zeta9 are as follows:

Date	Line Item Description	Value
Oct. 1	Inventory	200 units at $40
Oct. 7	Sale	180 units
Oct. 15	Purchase	180 units at $45
Oct. 24	Sale	150 units

Assuming a perpetual inventory system and using the first-in, first-out (FIFO) method, determine (a) the cost of goods sold on October 24 and (b) the inventory on October 31. a. Cost of goods sold on October 24 b. Inventory on October 31

Perpetual inventory usingFIFO

Beginning inventory, purchases, and sales for Item Zeta9 are as follows:

Date	Line Item Description	Value
Oct. 1	Inventory	200 units at $40
Oct. 7	Sale	180 units
Oct. 15	Purchase	180 units at $45
Oct. 24	Sale	150 units

Assuming a perpetual inventory system and using the first-in, first-out (FIFO) method, determine (a) the cost of goods sold on October 24 and (b) the inventory on October 31. a. Cost of goods sold on October 24 b. Inventory on October 31

Perpetual inventory usingFIFO

Beginning inventory, purchases, and sales for Item Zeta9 are as follows:

Date	Line Item Description	Value
Oct. 1	Inventory	200 units at $40
Oct. 7	Sale	180 units
Oct. 15	Purchase	180 units at $45
Oct. 24	Sale	150 units

Assuming a perpetual inventory system and using the first-in, first-out (FIFO) method, determine (a) the cost of goods sold on October 24 and (b) the inventory on October 31. a. Cost of goods sold on October 24 b. Inventory on October 31

Periodic inventory usingFIFO,LIFO, andweighted average cost methods

The units of an item available for sale during the year were as follows:

Date	Line Item Description	Units	Cost per Unit	Amount
Jan. 1	Inventory	15 units	at $43	$645
Aug. 13	Purchase	5 units	at $44	220
Nov. 30	Purchase	6 units	at $45	270
	Available for sale	26 units		$1,135

There are 16 units of the item in thephysical inventory at December 31. 

The periodic inventory system is used. Determine the inventory cost using the (a) first-in, first-out (FIFO) method; (b) last-in, first-out (LIFO) method; and (c) weighted average cost method(round per-unit cost to two decimal places and your final answer to the nearest whole dollar).

 

Line Item Description	Amount
a. First-in, first-out (FIFO) method	$
b. Last-in, first-out (LIFO) method	$
c. Weighted average cost method	$

Lower-of-cost-or-market method

On the basis of the following data, determine the value of the inventory at the lower-of-cost-or-market by applying lower-of-cost-or-market to each inventory item, as shown inExhibit 10.

Commodity	Inventory Quantity	Cost per Unit	Market Value per Unit (Net Realizable Value)
JFW1	6,330	$10	$11
SAW9	1,140	36	34

a. $

Effect of inventory errors

During the taking of itsphysical inventory on December 31, 20Y3, Waterjet Bath Company incorrectly counted its inventory as $728,660 instead of the correct amount of $719,880. Indicate the effect of the misstatement on Waterjet Bath's December 31, 20Y3, balance sheet and income statement for the year ended December 31, 20Y3. Also record the amount of each overstatement or understatement. Enter all amounts as positive numbers.

Line Item Description	Financial Statement	Understated or Overstated	Amount
Inventory	Balance SheetIncome Statement	OverstatedUnderstatedNo effect	$
Current assets	Balance SheetIncome Statement	OverstatedUnderstatedNo effect	$
Total assets	Balance SheetIncome Statement	OverstatedUnderstatedNo effect	$
Owner's Equity	Balance SheetIncome Statement	OverstatedUnderstatedNo effect	$
Cost of goods sold	Balance SheetIncome Statement	OverstatedUnderstatedNo effect	$
Gross profit	Balance SheetIncome Statement	OverstatedUnderstatedNo effect	$
Net income	Balance SheetIncome Statement	OverstatedUnderstatedNo effect	$

1. Inventory turnover and days' sales in inventory

Financial statement data for years ending December 31 for Tango Company follow:

Line Item Description	20Y7	20Y6
Cost of goods sold	$3,465,675	$3,849,655
Inventories:
Beginning of year	737,300	715,400
End of year	803,000	737,300

a.Determine the inventory turnover for 20Y7 and 20Y6.Round your answers to one decimal place.

Line Item Description	20Y7	20Y6
Inventory turnover	fill in the blank 1 of 2	fill in the blank 2 of 2

b.Determine the days' sales in inventory for 20Y7 and 20Y6. Use 365 days a year.Round your answers to one decimal place.

Line Item Description	20Y7	20Y6
Days' sales in inventory	fill in the blank 1 of 2days	fill in the blank 2 of 2days

c.Are the changes in inventory turnover and the number of days' sales in inventory from 20Y6 to 20Y7 favorable or unfavorable?