Question

most closely appreciate the a rt that we have inventory? Why (2) Which cost flow method (FIFOLIO net o m is a more likely indicato nest e Why? (3) Which cost flow method (FIFOGLIFO tom tual physical flow of god W (4) How much more cash will be available under LIFO than d (5) Will gross profit under the ave he higher or lower than Than LIFO (Note: It is not necessary to quantify your answer FIFO? Why? 2 AP P SB You have the following inform 2012. Wirth uses the periodic method for inventory ormation for Wirth in for the month and June 30 Date Description Unit Cost or June 1 Quantity Selling Price Beginning inventory $60 June 4 Purchase June 10 Sale June 11 Sale return June 18 Purchase June 18 Purchase return June 25 Sale 95 June 28 Purchase 70 25 15 o 10 FIFO $3,345 $3370 $3,153 bude ructions Calculate (i) ending inventory. (ii) cost of goods sold, (iii) gross profit, and (iv) gross profit rate under each of the following methods. (1) LIFO. (2) FIFO (3) Average-cost. (Round cost per unit to three decimal places.) Compare results for the three cost flow assumptions. 6B You have the following information for Gas Saver Plus. Gas Saver Plus uses the dic method of accounting for its inventory transactions. 100 0 per litre compare specific identification, FIFO, an LIFO under periodic use cost flow assum

Please help to do p6 5b

Answer 1

LIFO
	Cost of goods sold
	110 units from	units	rate	amount
	Jun28 purchase	20	70	1400
	Jun18 purchase	20	66	1320
	Jun4 purcahse	70	63	4410
	total	110		7130
	ending inventory
	Jun 4 purchase	15	63	945
	beginning invenotry	25	60	1500
	total	40		2445
	Gross Profit
	Sales	10175
	Less:Cost of goods sold	7130
	Gross Profit	3045

FIFO
	Cost of goods sold
	110 units from	units	rate	amount
	Beg inventory	25	60	1500
	Jun 4 purchase	85	63	5355
	total	110		6855
	ending inventory
	Jun18 purchase	20	66	1320
	Jun 28 purchase	20	70	1400
	total	40		2720
	Gross Profit
	Sales	10175
	Less:Cost of goods sold	6855
	Gross Profit	3320
Weighted average
	Cost of goods sold
	110 units from inventory	units	rate	amount
	we have calculated average rate
	63.833	110	63.833	7022
	(9575/150)
	ending inventory	40	63.833	2553
	Gross Profit
	Sales	10175
	Less:Cost of goods sold	7022
	Gross Profit	3153

Workings:

Date	Description	quantity	unit cost	amount
Jun-01	beg inve	25	60	1500
Jun-04	purchase	85	63	5355
Jun-18	purchase	35	66	2310
Jun-18	purchase returns	-15	66	-990
Jun-28	purchase	20	70	1400
		150	63.833	9575
Date	Description	quantity	unit cost	amount
Jun-10	Sale	60	90	5400
Jun-11	Sale return	-5	90	-450
Jun-25	Sale	55	95	5225
		110		10175