Stewart Co.’s beginning inventory and purchases during the year ended December 31, 2008, were as follows:

				Unit	Total
		Units		Cost	Cost
January 1	Inventory		1,000	$50.00	$ 50,000
March 10	Purchase		1,200	52.50	63,000
June 25	Sold 800 units
August 30	Purchase		800	55.00	44,000
October 5	Sold 1,500 units
November 26	Purchase		2,000	56.00	112,000
December 31	Sold 1,000 units
Total			5,000		$269,000

Instructions

1. Determine the cost of inventory on December 31, 2008, using the perpetual inventory system and each of the following inventory costing methods:

a. first-in, first-out

b. last-in, first-out

2. Determine the cost of inventory on December 31, 2008, using the periodic inventory system and each of the following inventory costing methods:

a. first-in, first-out

b. last-in, first-out

c. average cost

3. Assume that during the fiscal year ended December 31, 2008, sales were $290,000 and the estimated gross profit rate was 40%. Estimate the ending inventory at December 31, 2008, using the gross profit method.

Answer rating: 100% (QA)

Solution 1a Computation of ending inventory COGS under FIFO Stewart Co Date Beginning Inventory Purchase Cost of Goods Sold Ending Inventory Qty Rate Amount Qty Rate Amount Qty Rate Amount Qty Rate Am... View the full answer