Mar 24
| Warnerwoods Company uses a perpetual inventory system. It entered into the following purchases and sales transactions for March. |
| Date | Activities | Units Acquired at Cost | Units Sold at Retail | |||||||||
| Mar. | 1 | Beginning inventory | 100 | units | @ $51.00/unit | |||||||
| Mar. | 5 | Purchase | 225 | units | @ $56.00/unit | |||||||
| Mar. | 9 | Sales | 260 | units | @ $86.00/unit | |||||||
| Mar. | 18 | Purchase | 85 | units | @ $61.00/unit | |||||||
| Mar. | 25 | Purchase | 150 | units | @ $63.00/unit | |||||||
| Mar. | 29 | Sales | 130 | units | @ $96.00/unit | |||||||
| Totals | 560 | units | 390 | units | ||||||||
| Required: | |
| 1. | Compute cost of goods available for sale and the number of units available for sale. |
| 2. | Compute the number of units in ending inventory. |
| 3. | Compute the cost assigned to ending inventory using (a) FIFO, (b) LIFO, (c) weighted average, and (d)specific identification. For specific identification, the March 9 sale consisted of 65 units from beginning inventory and 195 units from the March 5 purchase; the March 29 sale consisted of 45 units from the March 18 purchase and 85 units from the March 25 purchase. (Round your average cost per unit to 2 decimal places.) |
| 4. | Compute gross profit earned by the company for each of the four costing methods. For specific identification, the March 9 sale consisted of 65 units from beginning inventory and 195 units from the March 5 purchase; the March 29 sale consisted of 45 units from the March 18 purchase and 85 units from the March 25 purchase. (Round average cost per unit to 2 decimal places.) |
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