50.1K

Verified Solution

Link Copied!

Luxury Iron Company began August with 45 units of iron inventory that cost $24 each. During August, the company completed the following inventory transactions: (Click the icon to view the transactions.) Read the requirements. Requirement 1. Prepare a perpetual inventory record for the merchandise inventory using the FIFO inventory costing method. Start by entering the beginning inventory balances. Enter the transactions in chronological order, calculating new inventory on hand balances after each transaction. Once all of the transactions have been entered into the perpetual record, calculate the quantity and total cost of merchandise inventory purchased, sold, and on hand at the end of the period. (Enter the oldest inventory layers first.) Requirement 2. Prepare a perpetual inventory record for the merchandise inventory using the LIFO inventory costing method. Start by entering the beginning inventory balances. Enter the transactions in chronological order, calculating new inventory on hand baland after each transaction. Once all of the transactions have been entered into the perpetual record, calculate the quantity and total cost of merchandise inventory purchased, sold, and on hand at the end of the period. (Enter the oldest inventory layers first.) Requirement 3 . Prepare a perpetual inventory record for the merchandise inventory using the weighted-average inventory costing method. Start by entering the beginning inventory balances. Enter the transactions in chronological order, calculating new inventory on hand balances after each transaction. Once all of the transactions have been entered into the perpetual record, calculate the quantity and total cost of merchandise inventory purchased, sold, and on hand at the end of the period. Requirement 4. Determine the company's cost of goods sold for August using FIFO, LIFO, and weighted-average inventory costing methods. The cost of goods sold amount for August using FIFO inventory costing is The cost of goods sold amount for August using LIFO inventory costing is The cost of goods sold amount for August using weighted-average inventory costing is Requirement 5. Compute gross profit for August using FIFO, LIFO, and weighted-average inventory costing methods. Requirement 6 . If the business wanted to maximize gross profit, which method would it select? If the business wanted to maximize gross profit, it would select the method. Data table Requirements 1. Prepare a perpetual inventory record for the merchandise inventory using the FIFO inventory costing method. 2. Prepare a perpetual inventory record for the merchandise inventory using the LIFO inventory costing method. 3. Prepare a perpetual inventory record for the merchandise inventory using the weighted-average inventory costing method. 4. Determine the company's cost of goods sold for August using FIFO, LIFO, and weighted-average inventory costing methods. 5. Compute gross profit for August using FIFO, LIFO, and weighted-average inventory costing methods. 6. If the business wanted to maximize gross profit, which method would it select

Answer & Explanation Solved by verified expert

See Answer