1. Determine the inventory on June 30 and the cost of goods sold for the three-month period, using the first-in, first-out method and the periodic inventory system. Inventory, June 30 $ Cost of goods sold $ 2. Determine the inventory on June 30 and the cost of goods sold for the three-month period, using the last-in, first-out method and the periodic inventory system. Inventory, June 30 $ Cost of goods sold $ 3. Determine the inventory on June 30 and the cost of goods sold for the three-month period, using the weighted average cost method and the periodic inventory system. Note: Round the weighted average unit cost to the nearest dollar and final answers to the nearest dollar. Inventory, June 30 $ Cost of goods sold $ 4. Compare the gross profit and June 30 inventories using the following column headings. For those boxes in which you must enter subtracted or negative numbers use a minus sign. FIFO LIFO Weighted Average Sales $ $ $ Cost of goods sold Gross profit $ $ $ Inventory, June 30 $ $ $

Complete Question:

The beginning inventory for Dunne Co. and data on purchases and sales for a three-month period are as follows: Date Transaction Number of Units Per Unit Total Apr. 3 Inventory 25 $1,200 $30,000 8 Purchase 75 1,240 93,000 11 Sale 40 2,000 80,000 30 Sale 30 2,000 60,000 May 8 Purchase 60 1,260 75,600 10 Sale 50 2,000 100,000 19 Sale 20 2,000 40,000 28 Purchase 80 1,260 100,800 June 5 Sale 40 2,250 90,000 16 Sale 25 2,250 56,250 21 Purchase 35 1,264 44,240 28 Sale 44 2,250 99,000

Required: 1. Determine the inventory on June 30 and the cost of goods sold for the three-month period, using the first-in, first-out method and the periodic inventory system. Inventory, June 30 $ Cost of goods sold $

2. Determine the inventory on June 30 and the cost of goods sold for the three-month period, using the last-in, first-out method and the periodic inventory system. Inventory, June 30 $ Cost of goods sold $

3. Determine the inventory on June 30 and the cost of goods sold for the three-month period, using the weighted average cost method and the periodic inventory system. Note: Round the weighted average unit cost to the nearest dollar and final answers to the nearest dollar. Inventory, June 30 $ Cost of goods sold $

4. Compare the gross profit and June 30 inventories using the following column headings. For those boxes in which you must enter subtracted or negative numbers use a minus sign. FIFO LIFO Weighted Average Sales $ $ $ Cost of goods sold Gross profit $ $ $ Inventory, June 30 $ $ $

1. Determine the inventory on June 30 and the cost of goods sold for the three-month period, using the first-in, first-out method and the periodic inventory system:

a) Inventory, June 30  = $32,864 (26 x $1,264)

b) Cost of goods sold = Cost of goods available for sale - Ending Inventory = $310,776 ($343,640 - $32,864)

2. Determine the inventory on June 30 and the cost of goods sold for the three-month period, using the last-in, first-out method and the periodic inventory system:

a) Inventory, June 30 =  $31,240

Beginning Inventory 25 units at $1,200 = $30,000

Purchase on April 8, 1 unit at $1,240               1,240

Total Ending Inventory                                $31,240

b)Cost of goods sold = Cost of goods available for sale - Ending Inventory

= $311,400 ($343,640 - $32,240)

3. Determination of the inventory on June 30 and the cost of goods sold for the three-month period, using the weighted average cost method and the periodic inventory system. Note: Round the weighted average unit cost to the nearest dollar and final answers to the nearest dollar:

a) Inventory, June 30 = $32,500 (26 x $1,250)

b) Cost of goods sold = $311,250 (249 x $1,250)  

4. Comparison of the Gross Profit and June 30 inventories using the following column headings:

                                         FIFO                  LIFO         Weighted Average

Sales                            $525,250         $525,250         $525,250

Cost of goods sold        -310,776            -311,400              -311,150

Gross profit                  $214,474           $213,850           $214,100

Inventory, June 30       $32,864             $31,240            $32,489.60

Explanation:

a) Data on Purchase and Sale Transactions with the Quarter:

Date     Transaction     Number of Units    Per Unit             Total

                                         In        Out                              Cost      Sales

Apr. 3    Inventory          25                        $1,200       $30,000

     8      Purchase          75                          1,240          93,000

    11      Sale                                40           2,000                          80,000

   30     Sale                                30           2,000                          60,000

May 8   Purchase          60                         1,260           75,600

    10     Sale                               50           2,000                         100,000

    19    Sale                                20           2,000                          40,000

   28    Purchase          80                         1,260         100,800

June 5 Sale                               40           2,250                          90,000

       16 Sale                               25           2,250                          56,250

       21 Purchase         35                         1,264           44,240

      28 Sale                               44           2,250                          99,000

b) Goods Available   275                                         $343,640

Cost of goods sold   249                                   See calculations

Sales                                       249                                          $525,250

Ending Inventory        26          See Calculations

c) Average cost of goods = Cost of goods available for sale/Quantity of goods available for sale = $343,640/275 = $1,249.60

d) Under the periodic inventory system:

1) FIFO assumes that the goods bought first are sold first.

2) LIFO assumes that the goods bought last are sold first

3) Weighted Average takes for granted that the cost of goods available for sale and inventory can be determined with the weighted average.  

Using the period inventory system, it is when physical count is taken of inventory that one can estimate its value.  Unlike the perpetual inventory system, the periodic inventory system waits till a financial period ends to value stock.  The results for ending inventory under the weighted average method, using the perpetual inventory system differs from the results under the same method, using the periodic inventory system.

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