Question

Problem 6-08A a1-a2 Wildhorse Co. is a retailer operating in Calgary, Alberta. Wildhorse uses the perpetual inventory method. Assume that there are no credit transactions; all amounts are settled in cash. You are provided with the following information for Wildhorse for the month of January 2022. Date Description Quantity Unit Cost or Selling Price Dec. 31 Jan. Ending inventory 150 Purchase 100 2 Sale 180 Jan. 6 Jan. 9 Jan. Purchase 70 Sale 60 10 Jan. Purchase 112 23 Jan. 30 Sale 128 Diolin 2010. bilan T. Alibbe named A Dicias . b one Te HA

Calculate average cost for each unit (Round answers to 3 decimal places, e.g 5.125)

Jan 1 $

Jan 2 $

Jan 6 $

Jan 9 $

Jan 10 $

Jan 23 $

Jan 30 $

For each of the following cost flow assumptions, calculate (i) cost of goods sold, (ii) ending inventory, and (iii) gross profit. (Round answers to 0 decimal places, e.g. 125.)

(1)		LIFO.
(2)		FIFO.
(3)		Moving-average.

Answer 1

Answer-1:

Calculation of average cost for each unit:

AVG. COST METHOD-PERPETUAL INVENTORY METHOD Purchase Sale Rate Total Unit Rate Total Unit 1 Date Unit 100 $ 21.000 $ 2,100 180 $ 20.400 $ 3,672 Dec.31 Jan.02 Jan.06 Jan.09 Jan.10 Jan.23 Jan.30 Balance Rate Total 150 $ 20.000 $ 3,000 250 20.400 5100 70 20.400 1 428 22.700 3178 80 22.700 1816 192 24.625 4728 24.625 $ 1,576 70 1750 140 25.000 1 26.000 6 0 22.700 1362 112 2912 128 24.625 64

Answer-2:

LIFO COST METHOD Sale Unit Rate Total Purchase Rate Date Unit Total Unit Dec.31 Balance Rate Total 150 20.000 $ 3,000 150 20.000 3000 100 21.000 2100 201400 Jan.02 100 21.000 $ 2,100 70/ Jan.06 T D I 80 100 2 0 $ 211 1,600 2100 Jan.09 70 25.000 1750 Jan.10 T 6 0 25 1500 201 25 201 25 26.000 20 $ 1400 1750 1400 250 1400 2501 2912 1,400 Jan.23 112 26.000 2912 112 64 Jan.30 6 200 1025 112 26 Total $ 120|| 2501 2912 8,482

Ending Inventory = 64 units @20 per unit = $1,400

Cost of goods sold = $8,482

Answer-3:

FIFO COST METHOD Sale Unit R ate Total Date Purchase Rate Unit Total Unit Dec.31 Balance Rate Total 150 20.000 $ 3,000 150 20.000 3000 100 21.000 2100 Jan.02 100 21 $ 2,100 150 20 $ Jan.06 3,000 630 30 Jan.09 1470 1470 1750 70 25 I 1750 I 21 21 25.0 21 25 70 60 21| 1260| 210 Jan. 10 - 21 1750 210 1750 2912 Jan.23 70 112 25 2 6 112 26 2912 21 Jan.30 25 10| 70 48 Total 210 1750 1248 8,098 26 26 $ 1,664 $

Ending Inventory = 64 units @26 per unit = $1,664

Cost of goods sold = $8,098