Purchase Solution

# Cost of inventory for Jippy Juice

Not what you're looking for?

From the excel document, the inventory records for jippy juice company rasperry juice cans

a) assuming a periodic inventory system, determine the cost of the ending inventory and the cost of goods sold using (i) FIFO (ii) Weighted average cost and (III) LIFO methods

b) Assuming a perpetual inventory system, determine the cost of the ending inventory and the cost of goods sold using (I) weighted average cost and (II) LIFO

c) Which method results in the highest cost of goods sold? Why?

d) Which method results in the highest ending inventory? Why?

e) Which method results in the highest cash flow? Why

f) Assume prices are expected to increase in the future. Which method would you recommend for Jippy Juice Company? Explain why.

##### Solution Summary

This is a solution to a multi-part accounting problem involving an inventory system for jippy juice, a fictitious company.

##### Solution Preview

a) Assuming a periodic inventory system, determine the cost of the ending inventory and the cost of goods sold using (i) FIFO (ii) Weighted average cost and (III) LIFO methods
Assuming the periodic inventory system, FIFO ending inv is 2528 and if we subtract this from 4368 we get the cost of goods sold as 1840
Weighted Average Cost is determined by dividing 4368 by 2100 giving us 2.08 and multiplying it by 1200, this gives us the cost of inventory as 2496 and the COGS as 1872.
Using the LIFO, we get the value of the 13 sales as 630 and 30th sale as 1268 giving us the cost of inventory as 2470 and COGS as 1898.
b) Assuming a perpetual inventory system, determine the cost of the ending inventory and the cost of goods sold using (I) weighted average cost and (II) LIFO
Please note that in the perpetual system the ...

##### Social Media: Pinterest

This quiz introduces basic concepts of Pinterest social media

##### Cost Concepts: Analyzing Costs in Managerial Accounting

This quiz gives students the opportunity to assess their knowledge of cost concepts used in managerial accounting such as opportunity costs, marginal costs, relevant costs and the benefits and relationships that derive from them.

##### Marketing Management Philosophies Quiz

A test on how well a student understands the basic assumptions of marketers on buyers that will form a basis of their marketing strategies.

##### Accounting: Statement of Cash flows

This quiz tests your knowledge of the components of the statements of cash flows and the methods used to determine cash flows.

##### Marketing Research and Forecasting

The following quiz will assess your ability to identify steps in the marketing research process. Understanding this information will provide fundamental knowledge related to marketing research.