Two wheels operates on a fiscal year beginning january 1 at

Assignment Help Accounting Basics

Reference no: EM13567775

Part 1:
The following table uses the four inventory costing method and displays the cost of ending inventory for Click Cameras:

Specific Identification	FIFO	LIFO	Weighted Average Cost
$21,476.00	$21,581.40	$21,410.93	$21,447.36

Click Cameras also reported the following amounts:

Net sales	$53,874.92
Purchases available for sale	$57,621.31

Instruction:
Use the information given above and determine the cost of merchandise sold and the gross profit on sales for each of the inventory costing methods.
Part 2:
Two Wheels operates on a fiscal year beginning January 1. At the beginning of the year, the shop had 6 bicycles @$394 each (opening inventory). During the year the business made the following purchases:

Date	Bicycle	Cost
Jan.20	4	$399
Mar. 5	5	$415
Apr. 23	7	$419
Aug. 14	4	$423
Oct. 3	6	$430
Nov. 17	3	$435

There were seven bicycles in inventory at the end of the period. During the year, the bicycles were sold for $675 each.
Instructions:

Calculate the cost of the ending inventory using the FIFO, LIFO, and weighted average cost methods.

Prepare a partial income statement for each inventory costing method showing the sales and the calculation of gross profit on sales.
Assume that the sales and purchases are net amounts.

Reference no: EM13567775

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