"FIFO perpetual inventory The beginning inventory at Midnight Supplies and data on purchases and sales...
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Accounting
"FIFO perpetual inventory
The beginning inventory at Midnight Supplies and data on purchases and sales for a three-month period ending March 31, are as follows:
Date Transaction Number per Total
Of units unit
Jan.1 Inventory 7,500 75.00 562,500
10 Purchase 22,500 85.00 1,912,500
28 Sale 11,250 150.00 1,687,500
30 Sale 3,750 150.00 562,500
Feb.5 Sale 1,500 150.00 225,000
10 Purchase 54,000 87.50 4,725,000
16 Sale 27,000 160.00 4,320,000
28 Sale 25,500 160.00 4,080,000
Mar.5 Purchase 45,000 89.50 4,027,500
14 Sale 30,000 160.00 4,800,000
25 Purchase 7,500 90.00 675,000
30 Sale 26,250 160.00 4,200,000
Instructions
1.Record the inventory, purchases, and cost of merchandise sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the first-in, first-out method.
2. Determine the total sales and the total cost of merchandise sold for the period. Journal-ize the entries in the sales and cost of merchandise sold accounts. Assume that all sales were on account.
3. Determine the gross profit from sales for the period""
4.Determine the ending inventory cost as of March 31.
5.Based upon the preceding data, would you expect the inventory using the last-in, first-out method to be higher or lower?"
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