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Chap 2.2

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14 views3 pages

Chap 2.2

Uploaded by

Xuân Vũ
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© © All Rights Reserved
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EXERCISE 6-8

Lower of
Net Realizable Cost or
Cost Value NRV
Cameras
Minolta W 850,000 W 780,000 W 780,000
Canon 900,000 912,000 900,000
Total 1,750,000 1,692,000

Light meters
Vivitar 1,500,000 1,380,000 1,380,000
Kodak 1,680,000 1,890,000 1,680,000
Total 3,180,000 3,270,000
Total inventory W4,930,000 W4,962,000 W4,740,000

*EXERCISE 6-15

(a) The cost of goods available for sale is:

June 1 Inventory 200 @ $5 $1,000


June 12 Purchase 300 @ $6 1,800
June 23 Purchase 500 @ $7 3,500
Total cost of goods available for sale $6,300

(1) FIFO
Date Purchases Cost of Goods Sold Balance
June 1 (200 @ $5) $1,000
June 12 (300 @ $6) $1,800 (200 @ $5)
(300 @ $6) }
$2,800
June 15 (200 @ $5) $1,000
(200 @ $6) 1,200 (100 @ $6) $ 600
(100 @ $6)
June 23 (500 @ $7) $3,500 (500 @ $7) } $4,100

June 27 (100 @ $6) 600 (120 @ $7) $ 840


(380 @ $7) 2,660
$5,460
Ending inventory: $840. Cost of goods sold: $6,300 – $840 =
$5,460.

(2) Moving-Average Cost


Date Purchases Cost of Goods Sold Balance
June 1 (200 @ $5) $1,000
June 12 (300 @ $6) $1,800 (500 @ $5.60) $2,800
June 15 (400 @ $5.60) $2,240 (100 @ $5.60) $ 560
June 23 (500 @ $7) $3,500 (600 @ $6.767) $4,060
June 27 (480 @ $6.767) $3,248 (120 @ $6.767) $ 812
$5,488

Ending inventory: $812. Cost of goods sold: $6,300 – $812 = $5,488.

(b) FIFO gives the same ending inventory and cost of goods sold
values under both the periodic and perpetual inventory system.
Moving-average gives different ending inventory and cost of goods
sold values under the periodic and perpetual inventory systems, due
to the average calculation being based on different pools of costs.

(c) The simple average would be [($5 + $6 + $7) ÷ 3)] or $6. However,
the moving-average cost method uses a weighted-average unit
cost that changes each time a purchase is made rather than a
simple average.

*EXERCISE 6-17

(a) Sales ....................................................... Rs800,000,0


00
Cost of goods sold
Inventory, November 1 ................... Rs100,000,000
Cost of goods purchased .............. 500,000,000
Cost of goods available for sale ... 600,000,000
Inventory, December 31 ................. 120,000,000
Cost of goods sold .................
480,000,000
Gross
profit Rs320,000,000

Gross profit rate Rs320,000,000/Rs800,000,000 = 40%


*EXERCISE 6-17 (Continued)

(b) Sales ................................................................................. Rs10,000,00


0
Less: Estimated gross profit (40% X Rs10,000,000) ...
4,000,000
Estimated cost of goods sold ........................................ Rs
6,000,000

Beginning inventory ........................................................ Rs


1,200,000
Cost of goods purchased ...............................................
6,100,000
Cost of goods available for sale .................................... 7,300,000
Less: Estimated cost of goods sold .............................
6,000,000
Estimated cost of ending inventory .............................. Rs
1,300,000

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