Tipton Processing maintains its internal inventory records using average cost under a perpetual inventory system....
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Accounting
Tipton Processing maintains its internal inventory records using average cost under a perpetual inventory system. The following information relates to its inventory during the year:
Jan.
1
Inventory on hand93,000 units; cost $4.00 each.
Feb.
14
Purchased 107,000 units for $5.00 each.
Mar.
5
Sold 163,000 units for $14.00 each.
Aug.
27
Purchased 63,000 units for $6.00 each.
Sep.
12
Sold 73,000 units for $14.00 each.
Dec.
31
Inventory on hand27,000 units.
Required: 1. Determine the amount Tipton would calculate internally for ending inventory and cost of goods sold using average cost under a perpetual inventory system. 2. Determine the amount Tipton would report externally for ending inventory and cost of goods sold using last-in, first-out (LIFO) under a periodic inventory system. 3. Determine the amount Tipton would report for its LIFO reserve at the end of the year. 4. Record the year-end adjusting entry for the LIFO reserve, assuming the balance at the beginning of the year was $9,300.
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