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  • Some of The Information Found On A Detailed Inventory Card

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    The document describes information found on a detailed inventory card for Soave Stationery Ltd. for the month of May. It includes beginning inventory quantities and costs, purchases during the month including quantities and costs, and sales during the month. It provides instructions to calculate ending inventory quantities and costs under FIFO and weighted average costing assumptions, and to prepare partial income statements and calculate gross profit percentages using the results. It also asks the reader to recalculate under the assumption that perpetual inventory is kept in dollars rather than units, and whether the ending inventory amounts would be the same under the two costing methods.

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    Some of the Information Found on a Detailed Inventory Card

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    The document describes information found on a detailed inventory card for Soave Stationery Ltd. for the month of May. It includes beginning inventory quantities and costs, purchases during the month including quantities and costs, and sales during the month. It provides instructions to calculate ending inventory quantities and costs under FIFO and weighted average costing assumptions, and to prepare partial income statements and calculate gross profit percentages using the results. It also asks the reader to recalculate under the assumption that perpetual inventory is kept in dollars rather than units, and whether the ending inventory amounts would be the same under the two costing methods.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    41 views2 pages

    Some of The Information Found On A Detailed Inventory Card

    Uploaded by

    Freelance Worker
    The document describes information found on a detailed inventory card for Soave Stationery Ltd. for the month of May. It includes beginning inventory quantities and costs, purchases during the month including quantities and costs, and sales during the month. It provides instructions to calculate ending inventory quantities and costs under FIFO and weighted average costing assumptions, and to prepare partial income statements and calculate gross profit percentages using the results. It also asks the reader to recalculate under the assumption that perpetual inventory is kept in dollars rather than units, and whether the ending inventory amounts would be the same under the two costing methods.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    Some of the information found on a detailed inventory

    card #2015
    Some of the information found on a detailed inventory card

    Some of the information found on a detailed inventory card for Soave Stationery Ltd. for May is
    as follows:

    Instructions

    (a) From the above data, calculate the ending inventory perpetual inventory records are kept in
    units only and unit costs to the nearest cent and ending inventory to

    1. First-in, first-out (FIFO)

    2. Weighted average cost based on each of the following cost formulas. Assume that average
    cost is calculated monthly at each month end. Carry the nearest dollar.

    (b) Based on your results in part (a), and assuming that the average selling price per unit during
    May was $7.25, pre- pare partial income statements up to the "gross profit on sales" line.
    Calculate the gross profit percentage under each inventory cost formula. Comment on your
    results.

    (c) Assume the perpetual inventory record is kept in dollars, and costs are calculated at the time
    of each withdrawal. Recalculate the amounts under this revised assumption, carrying average
    unit costs to four decimal places. Would the ending inventory amounts under each of the two
    cost formulas above be the same? Explain.

    1/2
    Some of the information found on a detailed inventory card

    ANSWER
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