Question

Required Information The following information applies to the questions displayed below] Hemming Co. reported the following current-year purchases and sales for its only product. I Date Jan. 1 inventory Activities Beginning Jan. 1e Sales Mar.14 Purchase Mar.15 Sales July3e Purchase Oct. 5 Sales Oct. 26 Purchase Totals Units Acquired at Cost Units Sold at Retail 235 units@ $11.40 = 5 2,679 170 units@ $41.40 360 unitse $16.40 - 5,904 290 unitse $41.40 435 units@ $21.40 - 9,309 P 410 units@ $41.40 135 unitse $26.40 - 3,564 1,165 units $21,456 870 units Tences Required: Hemming uses a perpetual inventory system. Assume that ending inventory is made up of 65 units from the March 14 purchase. 95 units from the July 30 purchase, and all 135 units from the October 26 purchase. Using the specific identification method, calculate the following a) Cost of Goods Sold using Specific Identification Available for Sale Date Activity Units Unit Cost Beginning Inventory Cost of Goods Sold Ending Inventory Ending Units Ending Unit Cost COGS Inventory Unit Cost Inventory Units $ 0.00 $ 01 50.00 5 $ 0.00 S 0.00 $ 0.00 30. 000 $ 0.00 Purchase Mar. 16 July 30 Oct 26 0

Answer 1

Specific Identification Method ] Available for sale Cost of Goods sold Ending Inventory No of units Cost per unit No of units Cost per cost of goods No of unit sold units Cost per unit Ending Inventory Jan-01 Beginning inventory Mar-14 Purchases Jul-30 Purchases Oct-26 Purchases Total ol 1066 235 360 435 135 1165 11.40 16.40 21.40 26.40 235 295 340 11.40 16.40 21. 40 26.40 2679 4838 7 276 0 14793 ol 65 9 5 135 295 11.401 16.40 21.40 26.40 0 3564 6663 870 Less: Sales Cost of goods sold Gross profit 36018 14793 21225 Equals

a) Periodic FIFO Cost of Goods sold Cost of goods Available for sale No of Cost per Cost of goods Available for units unit sale 235 11.40 2679 No of units Cost per cost of goods unit sold 11.40 2679 Ending Inventory No of Cost per Ending units unit Inventory 11.40 235 Beginning inventory Purchases: Mar-14 Jul-30 Oct-26 Total 16.40 21.40 26.40 360 275 360 4351 135 1165 5904 5885 16.40 21.40 26.40 160 5904 9309 3564 21456 16.40 21.40 26.40 135 295 3424 3564 6988 870 14468 b) Periodic LIFO Cost of Goods sold Ending Inventory Cost of goods Available for sale Cost of goods No of Cost per Available for sale 235 11.40 2679 No of units No of units units Cost per Cost of goods unit sold 11.40 0 Ending Inventory unit 1 Cost per unit 11.40 235 2679 Beginning inventory Purchases: Mar-14 Jul-30 Oct-26 Total 360 435 135 1165 16.40 21.40 26.40 5904 9309 3564 21456 984 0 300 4 35 135 870 16.40 21.40 26.40 492060 9309 0 3564 0 17793 295 16.40 21.40 26.40 3663

LIFO C) Gross margin Sales revenue Less: Cost of goods sold Gross margin FIFO 36018 14468 36018 17793 18225 21550