Suppose you have the following information regarding the POTAK Ventures: Mobile phones inventory records Quantity and...

 

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Suppose you have the following information regarding the POTAK Ventures: Mobile phones inventory records Quantity and prices of mobile phones Inventory on 1st January First purchase in the year Second purchase in the year Total available for sale Inventory on 31st December Quantity 100 300 200 600 50 Price 1000 900 800 Total (Ghe) 100,000 270,000 160.000 530,000 a) Use FIFO method to compute the cost of ending inventory of mobile phones of POTAK Ventures. b) Use average cost method to compute the cost of total sales of tubes of POTAK Ventures for the year. c) Use LIFO method to compute the cost of ending inventory of tubes of POTAK Ventures. d) Which method is preferred for tax purposes and why? Suppose you have the following information regarding the POTAK Ventures: Mobile phones inventory records Quantity and prices of mobile phones Inventory on 1st January First purchase in the year Second purchase in the year Total available for sale Inventory on 31st December Quantity 100 300 200 600 50 Price 1000 900 800 Total (Ghe) 100,000 270,000 160.000 530,000 a) Use FIFO method to compute the cost of ending inventory of mobile phones of POTAK Ventures. b) Use average cost method to compute the cost of total sales of tubes of POTAK Ventures for the year. c) Use LIFO method to compute the cost of ending inventory of tubes of POTAK Ventures. d) Which method is preferred for tax purposes and why?

Answer rating: 100% (QA)

Solution Total available for sale 600 Ending inventory 50 Cost of goods sold 600 50 550 a ... View the full answer