Share
Explore BrainMass

Vulcan Co. uses the perpetual inventory method

Please see attached excel worksheet dealing with accounting questions.

23. Vulcan Co. uses the perpetual inventory method. The inventory records for Vulcan reflected the following:

1-Jan Beginning Inventory 300 Units @ 2.10
12-Jan First Purchase 400 Units @ 2.40
21-Jan Second Purchase 600 Units @ 2.50
31-Jan Sales 800 Units @ 5.00

Assuming that Vulcan uses a FIFO cost flow method, the cost of goods sold for January is
Answer
A $1590.00
B $1840.00
C $1740.00
D $1680.00

24. What was Vulcan's gross margin for the month of January assuming a FIFO cost flow method?

Answer
A $2160.00
B $2410.00
C $2260.00
D $2320.00

25. The inventory records for Hugo Co. reflect the following:

beginning inventory @ May 1 200 Units @ 1.00
First Purchase @ May 7 300 Units @ 1.10
Second Purchase @ May 17 500 Units @ 1.30
Sales @ May 31 900 units @ 2.00

Determine Hugo's cost of goods sold for May assuming the LIFO cost flow method.
Answer
A 1140
B 1040
C 1080
D 940

26. Determine Hugo's inventory at the end of May assuming the LIFO cost flow method.

A) $100
B) $130
C) $110
D) $120

27.) Friday Enterprises started the period with 150 units in beginning inventory that cost $2 each
Purchase No. of Items Cost
1 200 $3.00
2 150 $3.10
3 50 $3.50
During the period the company purchased inventory items as follows:

Friday sold 350 units after purchase 3
Friday's cost of goods sold assuming the weighted average cost flow method would be:

A) $525
B) $980
C) $700
D) $1065

Attachments

Solution Preview

First Question:
Company uses FIFO (first in first out). COGS in January is?
We have 800 units sold. Beginning with first units in inventory, working toward bottom, we have:
300 units at $3.10=$630
400 units at $2.40=$960
100 units @ $2.50=$250
630+960+250=$1840
B) $1840

#24
Gross ...

Solution Summary

Several accounting questions including change in inventory, effects of LIFO and FIFO on COGS

$2.19