Connect Chapter 6 Homework - MGMT-026

S't\'3.rd:

1. 10 out of 10.00

1. Harris Company has shipped $20,000 of goods to Harlow C-0., and Harlow Co. has arranged to sell the goods i or Harris.

a. Identify the consignor. ? Harlow Co. ? Harris Co.

b. Identify the consignee. ? Harlow Co. O Harris Co.

c. Which company should include any unsold goods as part of its inventory? ? Harris Co. G HarlowCo.

2. At year-end, Harris C-0. had shipped $12,500 o i merchandise FOB destination to Harlow Co. Which company should include the $12,500 of merchandise in transit as part of its year-end inventor/ ? G HarlowCo. ? Harris Co.

award:

2 10outof

.............?..............?p1o0.i0n0ts?

Walberg Associates, antique dealers, purchased the contents of an estate for $75,000. Terms of the purchase were FOB shipping point, and the cost oi transporting tile goods to Walberg Associates' warehouse was $2,400. Walberg Associates insured the shipment at a cost of $300. Prior to putting the goods up for sale, they cleaned and refurbished them at a cost of $980.

Determine the cost of the inventory acquired from tile estate.

ost of inventory (estate's contents)

Price

.../ $

Transportation-in

.../

Insurance on shipment

.../

Cleaning and refurbishing

.../

Total cost of inventory

$

75,000. / 2,400. / 300. /

980. /

I 78,680

(The follol11ing inforn1ation applies to the quesUons displayed be/0~11.]

Laker Company reported the following January purchases and sales data for its only product.

Date

Activities

Units Acquired at Cost

Jan. 1 Beginning Inventory 140 units@$6.00 = $ 840

Jan. 10 Sales

Jan. 20 Purchase

60 units@ S 5.00 = 300

Jan. 25 Sales

Jan. 30 Purchase

180units@$ 4.50 = 810

Units sold at Retail 100 units @ $ 15

80 units@ $ 15

Totals

380 units

s 1,950 180 units

Laker Company uses a perpetual inventory system. For specific identification, ending inventory consists of 200 units, where 180 are from the January 30 purchase, 5 are from the January 20 purchase, and 15 are from beginning inventory.

S't\'3rd :

3. 10 out of 10.00

1. Complete the table to determine the cost assigned to ending inventory and cost of goods sold using specific identification.

ISpecific Identification

Purchase Date

Jan. 1 Jan. 20 Jan. 30

'--

Available for Sale

""""""""'"'==

Activity

Units

Unit Cost

!Beginning Inventory

140 $ 6.00,/1

Cost of Goods Sold

Ending Inventory

Units Solil

Unit Cost

125.,i $

6.00

COGS

Ending Inventory-

un?

Cost Per Unit

$ ~I

15.,i $

6.00

Ending Inventory-

Cost

$

90

r urchas_e__ __,___ 60 $ 5 00.11

55,/ $

5.00 $

275

5.,i $

5.00 $

25

Purchase

.---1_8_0 ~$~_4.50.lrr

180,/ $

4.50 $

8 10

?---

380

180

$

J:;025

200 I

' $

925

4.

award:

10 out of

10.00

2. Determine the cost assigned to ending inventory and to cost of goods sold using weighted average. (Round cost per unit to 2 decimal places. Amou nts to be deducted should be i ndicated with a minus sign.)

- 1Weiahted Averaae Peroetua1?

=

Date

Goods ourchase!I

#of units

Cost per unit

Cost of Goods Sold

#of units sold

Cost per unit

Cost of Goods Sold

January 1

1

!January 10

~ary -20 T1

Average cost

I I

60,/ @ 1$

I

I I

I 100.1 @ $

-500.11

I I

I

I

'

6.00.1 = $

++

I

I 000.00

--

January 25 IJanuary 30

!Totals

!

180,/ @ 1$

I I I I

80,/ @ $

~

I I

I

5.40,/ = $ 432.00

++ +

I

$ 1,032.00

Inventory Balance

#of units

Cost per unit

Inventory Balance

I@ 140

1$

40,/ @ $

40 I @ !$ 60 @ !$

I 6.00 = 1$ ' 6.00.1 = $

60~+ t

5.00 =

840.00

I 240.00 I 24-0.0-0 .

300.00

100 @ 1$ 5.40,/

$ 540.00

20,/ @ $

1:20

!$

180

!$

200 @ .1$

5.40,/ = $

5.4~+ t

4.50 =

1$ 4 59. /1

108.00

108.00-

810.00 9!,8 01} :

award:

5. 10outof 10.00

3. Determine the cost assigned to ending inventory and to cost of goods sold using FIFO.

--

Per11etuat FIFO:

I

= Date January 1 January 10

r!January 20

Goods 11urchased

=

#of units

Cost per unit

I I

Cost of Goods Sold

#of units sold

I

Cost per unit

Cost of Goods Sold

I

Inventor.! Balance

#of units

I 140 @

Costper ] Inventory

unit

Balance

I 1$ 6.oo = 1I$ 840.00

I

I

- 1- 'I _ I

60./ @ $

-

- f-

I 100.I @ $ 6 00./ = $ 600.00

? t ? ? - II

40.I @ $ 6.00 =

n 40./ @ $ 6.00 =

60./ @

5.00 - =

I $ 240.00

I ;$ 240.00

'

300.00

1$ 540.00

January 25

I

I

I

I

~nuary 30

I

I

I

180./ @ $ 4 50./I

>-~tals

--

- i- -

_I

I

I 40./ @ $ 6.00 = $ 240.00

40./ @ $ 5.00 =

200.00

$ 440.00

~=t- - ---

I

-

_I

--

I? ?? $ 1,040.00

0 @ $ 20./ @ $

- -- 0 _ @ $

20./ @ $ 180./ @ $

6.00 =

I

5.00 = $ 100.00

$ 100.00

- 6.00

I

5.00 - = -- 100.00 1

4.50 =

810.00 ?1

l$ 9\.0.00

6 ?

award:

10out of 10.00

.............. ?point s?

? .................... ......................... ? .... ?

4. Determine the cost assigned to ending Inventory and to cost of goods sold using U FO.

Perootual LIFO:

Date

January 1 January 10 January 20

., r"99"? purcbaHd

II ol units

Cost per unit

I

Cost of Goods SOid

#of units sold

Cost per un it

Cost of Goods SOid

[

s 100.; @ s 6.00.i =

600.00

60.I @ s 5.00.,

-

January 25 January 30 Totals

180./ @ $

j

I

I I

4 50.lj

I

I

20.i @ s 6.00 = s 120.00

60.I @ s 5.00 =

300.00

$ 420.00

$,,,-1 ,020(00

1nytntmy Aelonce

#of units

Cost per unit

Inventory Balance

140 @ $ 6.00 = $ 840.00

I 40.i @

$

s 6.00 =

240.00

40.,I @ $ 6.00 = s 240.oo 1

60.,I @

s

5.00

~ = 00

20.,1 @ $ 6.00 = s 12000 1

0

@

$

I 5.00 = s 120.00

I 20.i @ $ 6.00 = $ 120.00

0 @ $ 5.00

I

180.i @ $ 4.50 =

810.00

$ "-93(}.Qi)'

award:

7 10outof

? .....?....... p10o.i'0n0ts ? .................................................................................................................................................. ?

Laker Company reported the following January purchases and sales data ior its only product.

Date

Activities

Jan. 1 Beginning inventory

Jan. 10 Sales

Jan. 20 Purchase

Jan. 25 Sales

Jan. 30 Purchase

Units Acq uired at Cost

140 units @ $6.00 = $ 840

6 0 units @ $5.00 = 300

180 units @ $4.50 = 810

Units Sold at Retail 100 units@$15 80 units @$15

Totals

380 units

$1,950

180 units

l aker uses a perpetual inventory system. For specific identification, ending inventory consists of 200 units, where 180 are from the Januar; 30 purchase, 5 are from the January 20 purchase, and 15 are from beginning inventory.

1. Complete comparative income statements for the month of January for l aker Company for the four inventor/ methods. Assume expenses are $1,250, and that the applicable income tax rate is 40%. (Round your lntermecl iate calculatio ns to 2 decimal l)laces.)

Sales Cost of goods sold Gross profit Ex penses Income before taxes Income tax expense

Net income

LAKER COMPANY

Income Statements

For Month Ended January 31

Specific

Weighted

Identification

Averalll!

$

2.700./ $

2,700./ $

1,025. /

1.032. /

1,675

1,668

1,250. /

1,250. /

425

4 18

170. /

167. /

1$

255 1$

251 1$

FIFO 2,700./ $ 1.040. / 1,660 1,250. / 4 10 164. / 246 1$

LIFO 2,700. / 1,020. / 1,680 1.250. / 430 172. / 258 I

2. Which method yields the highest net income?

? UFO

0 Specific identification

? FIFO

0 Weighted average

3. Does net income using weighted average fall between that using FIFO and UFO?

? Yes O No

4. If costs were rising instead of falling, which method would yield the highest net income?

O UFO ? FIFO

0 Weighted average 0 Specific identification

Hemming Co. reported the following current-year purchases and sales data for its only product.

Date

Activities

Jan. 1 Beginning inventory Jan. 10 Sales

Mar. 14 Purchase

Mar. 15 Sales

July 30 Purchase

Oct. 5 Sales Oct 26 Purchase

Units Acquired at Cost

s 200 units @ $10 = 2,000

350 units @ $15 = 5,250 450 units @ $20 = 9,000 100 units @ $25 = 2,500

Units Sold at Retail 150 units @S40 300 units @S40 430 units @S40

Totals

1,100 units

$18,750

880 units

Hemming uses a perpetual inventory system.

award:

8. 10out of 10.00

?????? ??? ??? ??? ????????points ????? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ??? ?????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????

Determine the costs assigned to ending inventory and to cost of goods sold using FIFO.

1Peroetual FIFO?

l

Date January 1 1 January 10 1March 14 1--

--

I March 15

IJuly 30

r

Goods 11urchased

;?

#of units

Cost per unit

I I

Cost of Good s Sold

# of units sold

Cost per unit

I

Cost of Goods Sold

I

I

15o./ @ $ 10 00 J =

I $ 1,500.00

=~

I I

350.I @

- ?I- $ 15 00.11

r I

1? 1

- 50.I @ $ 10.00

250.I @ $ 15.00 =

1 1

$

-500.00 1

3,750.00

$ 4.250.00

I

- - r~?

450.I @

$ 2000.11

J_

?I

--

_ II

laventQ!l! Balance

.

#of units

Cost per lnventoiy Balance unit

I 200 @ $ 10.00 = 1$ 2,000.00

5o./ @ $ 50.I @ $

-- 350.I @ $ -~

1 10.00 = $

10.00 15.00

= =

1$

'$

I 500.00

500.00 1 5,250.00 5,750.00

0 @ $ 10.00 -

100.I @ $ 15.00 = $ 1,500.00

$ 1.500.00

0 @ $

100.1 @ $

- - - 450.I @ $ "--

10.00

15.00 =

20.00 - =

.1 1,500.00 1

I 9.000.00

1$ 10,500.00 :

October 5

? October26

~

!Totals

I I _ II

--? --?

100.1 @ $

-

-1-

--

I

0 @ $

100.1 @ $

I

330.I @ $

I

2500. ll

I

-- -

?-- -- -

10.00 = 15.00 = 20.00 =

-~

$

I 0.00

1,500.00

6,600.00

$ 8,100.00

I

J

~

$ 13,850.00

0 @ 0 @ 120.I @

$ 10.00 $ 15.00 $ 20.00

l 0- ~ $

0 @ 120.I @ $

100n

10.00 15.00 20.00 25.00

I

=

2,400.00

$ 2,400.00

_ .I _I

=

2, 400. 0 A

-f- - -

2,500.00

I ; - : ;,90000

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