Wilson Lawn & Garden sells lawn and garden equipment and products, including 50-pound bags of fertilizer. Use the following information to determine the cost of goods sold and the value of the ending inventory of fertilizer bags under each of the designated cost flow assumptions. Wilson uses a periodic inventory system. 

DATEPER UNITTOTAL June 1 Balance300 bags at $10 per bag$ 3,000 June 10 Sold200 bags at $24 per bag$ 4,800 June 11 Purchased800 bags at $12 per bag$ 9,600 June 15 Sold500 bags at $25 per bag$ 12,500 June 20 Purchased500 bags at $13 per bag$ 6,500 June 27 Sold300 bags at $27 per bag$ 8,100 Inventory (in Units) 300 bags 

LIFO Cost of Goods Sold During June: 

June 30 Ending Inventory Value: 

FIFO Cost of Goods Sold During June: 

June 30 Ending Inventory Value: 

Units LIFO $ FIFO $ Beginning Inventory + Purchases ________ __________________ Available for Sale -Ending Inventory ________ __________________ Cost of Goods Sold LIFO $ FIFO $ Sales Less: Cost of Goods Sold ___________________ Gross Profit Gross Profit % 

Using the following information, show how Wilson’s June purchases and sales of those same 50-pound fertilizer bags impacted its statement of cash flows, income statement, and balance sheet during the month. Assume all inventory purchases are on credit and that there was no beginning balance in the accounts receivable account. Disregard income taxes and assume that the gross profit represents the net income effect of the transactions. 

•Assume Wilson used the LIFO method, resulting in cost of goods sold of $12,500 and an ending inventory value of $6,600 

•There was a $4,200 beginning balance in the accounts payable account on June 1 

•Suppliers were paid $13,500 during the month of June 

•Wilson earned $25,400 of revenue on sales of the fertilizer bags; $19,900 of the revenue related to cash sales, and the rest were credit sales HINT: We’re looking for the CHANGE in each account during the month of June. For instance, the impact on inventory account is the difference between the ending inventory and the beginning inventory. 

You may use the t-accounts on the next page to help you determine the impact (using t-accounts are not required). STATEMENT OF CASH FLOW EFFECTS Received from customers (O) Paid to suppliers (O) NET CHANGE IN CASH FLOW Note: (O) means operating cash flow INCOME STATEMENT EFFECTS GROSS PROFIT   BALANCE SHEET EFFECTS ASSETS: LIABILITIES + EQUITY: CHANGE IN ASSETSCHANGE IN LIABILITIES + EQUITY CashAccounts ReceivableInventory Bal 10,000Bal0Bal 3,000 Accounts PayableRetained Earnings 4,200Bal8,800Bal Sales RevenueCost of Goods Sold Expense

Answer rating: 100% (QA)

Answer Step by Step Explanation Answer Units LIFO FIFO Beginning In... View the full answer