Question

TH VOIR. IVICUUIU TI Score: 0 of 1 pt 6 of 6 (5 complete) P6-28A (similar to) Fit World began May with merchandise Inventory of 70 crates of vitamins that cost a total of $4,560. During the month, Fit World purchased and sold merchandise on account as follows: E! (Click the icon to view the transactions.) Read the requirements Requirement 1. Prepare a perpetual inventory record, using the FIFO inventory costing method, and determine the company's cost of goods sold, ending merchandise inventory, and grose Begin by computing the cost of goods sold and cost of ending merchandise Inventory using the FIFO inventory costing method. Enter the transactions in chronological order, calculating new Once all of the transactions have been entered into the perpetual record, calculate the quantity and total cost of merchandise inventory purchased, sold, and on hand at the end of the peric Purchases Cost of Goods Sold Inventory on Hand Data Table Unit Total Unit Total Unit Total Date Quantity Cost Cost Quantity Cost Cost Quantity Cost Cost 650 4550 May 5 Purchase 130 crates @ $ 76 each 5 13076 9880 13 Sale 140 crates @ $ 100 each 18 Purchase 150 crates @ $ 83 each 200 26 Sale 160 crates @ $ 102 each Print Done Totals Enter any number in the edit fields and then click Check Answe 6 parts remaining

Answer 1

S.No Purchases Date FIFO Inventory Costing Cost of Goods Sold Unit Total Total Cost Quantity Cost Cost Quantity Unit Cost Quantity Inventory on Hand Unit Total Cost Cost 4550 4550 9880 Mav-01 May-05 && 130 769880 Mav-13 70 65 4550 5320 May-18 12450 4560 4560 12450 & May-26 4560 83001 100183 4150 4150 May-31 Closing Stock 83 Purchases Date LIFO Inventory Costing Cost of Goods Sold Unit Total Total Cost Ouantity Cost_| Cost Quantity Inventory on Hand Unit | Total Quantity Cost Cost 4550 4550 9880 Unit Cost 76 May-01 May-05 130 9880 Mav-13 130 10 76 65 9880 650 May-18 150 12450 3900 3900 12450 May-26 150 100 83 65 12450 650 | 3250 May-31 Closing Stock 65 3250 Date zo Weighted Average Inventory Costing Purchases Cost of Goods Sold Inventory on Hand Unit Total Unit Total Unit Cost Total Cost | Quantity Cost | Cost Quantity Cost Cost 65 4550 9880 200 14200 140 71994060 4260 12450 210) 16170 160 77 12320 771 3850 Quantity May-01 May-05 1301 Mav-13 May-18 150 May-26 May-31 Closing Stock 761 3850 Computation Of Weighted Cost Per unit Particulars As on Mav05 As on May18 Caliculation Rounding Off Cost Per Unit 70.5 77 0.5 4 Income Tax Implication on Gross profit i) As the business wants to pay the least amount of income tax it is better to choose LIFO Inventory Costing ii) When compared with the reaming two methods such as FIFO & Weighted Average inventory costing they will give us a gross pro iii) As the LIFO inventory Costing gives only a gross Profit of $6690 Computation of Gross profits Computation of Gross profit In case of FIFO Inventory Costing Unit Particulars Quantity Cost Total Amount(in $) Sale Value of Goods sold on May-13 140 100 14000 May-26 10216320 30320 Cost of Goods Sold on May-1370 9870 654550 5320 76 4560 83 8300 May-26 6 0 100 12860 Gross proft of goods sold in case of FIFO Inventory Costing 7590 Computation of Gross profit In case of LIFO Inventory Costing Unit Particulars Quantity Cost Total Amount(in $) Sale Value of Goods sold on May-13140 100 14000 May-26 160 102 16320 30320 Cost of Goods Sold on May-13 130769880 650 10530 May-26 150 65 12450 650 13100 Gross proft of goods sold in case of LIFO Inventory Costing 6690 Computation of Gross profit In case of Weighted Average Inventory Costing Unit Particulars Quantity Cost Total Amount(in $) Sale Value of Goods sold on May-13 140 100 14000 May-26 160 102 16320 30320 Cost of Goods Sold on May-1314071 9940 May-26 160 77 12320 22260 s proft of goods sold in case of Weighted Average Inventory Co 8060