Problem 5-3A Perpetual: Alternative cost flows LO P1
15.00 points
Problem 5-3A Perpetual: Alternative cost flows LO P1
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Montoure Company uses a perpetual inventory system. It entered into the following calendar-year 2015 purchases and sales transactions. |
| Date | Activities | Units Acquired at Cost | Units Sold at Retail | ||||||||||||||
| Jan. | 1 | Beginning inventory | 600 | units | @ | $ | 35 | per unit | |||||||||
| Feb. | 10 | Purchase | 300 | units | @ | $ | 32 | per unit | |||||||||
| Mar. | 13 | Purchase | 150 | units | @ | $ | 20 | per unit | |||||||||
| Mar. | 15 | Sales | 725 | units | @ | $ | 80 | per unit | |||||||||
| Aug. | 21 | Purchase | 190 | units | @ | $ | 40 | per unit | |||||||||
| Sept. | 5 | Purchase | 540 | units | @ | $ | 37 | per unit | |||||||||
| Sept. | 10 | Sales | 730 | units | @ | $ | 80 | per unit | |||||||||
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| Totals | 1,780 | units | 1,455 | units | |||||||||||||
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| Required: | |
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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. |
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3. |
Compute the cost assigned to ending inventory using (a) FIFO, (b) LIFO, (c) weighted average, and (d) specific identification. For specific identification units sold consist of 600 units from beginning inventory, 200 from the February 10 purchase, 150 from the March 13 purchase, 140 from the August 21 purchase, and 365 from the September 5 purchase. (Round your average cost per unit to 2 decimal places.) |
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4. |
Compute gross profit earned by the company for each of the four costing methods. (Round your average cost per unit to 2 decimal places.) |
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