6A1

cost of ending inventory

specific identification method

50 units*14=700 cost of goods available for sale 16650
60 units*17=1020 less:ending inventory 3340
90units*18=1620 cost of goods sold 13310
total 3340

FIFO
100*20=2000 cost of goods available for sale 16650
100*18=1800 less:ending inventory 3800
TOTAL 3800 cost of goods sold 12850

LIFO
150*14=2100 cost of goods available for sale 16650
50*15=750 less:ending inventory 2850
TOTAL 2850 cost of goods sold 13800

WAC
200*16.65=333 3330 cost of goods available for sale 16650
less:ending inventory 3330
13320
6A2
FIFO
1-Oct beginning inventory 10 7 70
3-Oct 20 9 180
19-Oct ending inventory 250
26-Oct cost of goods sold:
cost of goods available for sale 810
less: ending inventory 250
cost of goods sold 560

6A3 Perpetual inventory card(FIFO)

Purchase sale
date units rate total units cost total
1-Oct
3-Oct 40 5 200

9-Oct 10 4 40

14-Oct 10 4
 35 5 215
19-Oct 50 7 350

22-Oct 5 5
25 7 200
26-Oct 20 9 180

28-Oct 10 7 70

31-Oct 5 7 35

Total 560

Perpetual inventory card(LIFO)

Purchase sale
date units rate total units cost total
1-Oct
3-Oct 40 5 200

9-Oct 10 5 50

14-Oct 30 5
15 4 210
19-Oct 50 7 350

22-Oct 30 7 210

26-Oct 20 9 180

28-Oct 10 9 90

31-Oct 5 9 45

Total 605

summary FIFO LIFO

COST OF GOODS SOLD 560 605
ENDING INVENTORY 250 205
6A4 quantity cost market price
Product group I
A 200 10 2000 11 2200
B 170 9 1530 7 1190
C 210 15 3150 22 4620
D 40 11 440 9 360
Product group II 7120 8370
E 4100 3 12300 4 16400
F 3700 5 18500 2 7400
30800 23800
6A4 quantity cost market price lcm method item wi
Product group I
A 200 10 2000 11 2200 2000
B 170 9 1530 7 1190 1190
C 210 15 3150 22 4620 3150
D 40 11 440 9 360 360
Product group II 7120 8370 6700
E 4100 3 12300 4 16400 12300
F 3700 5 18500 2 7400 7400
30800 23800 19700

26400
LIFO
beginning inventory 20 4 80
10 5 50
ending inventory 130
cost of goods sold:
cost of goods available for sale 810
less: ending inventory 130
cost of goods sold 680

balance
units cost total
20 4 80
20 4
40 5 280
10 4
40 5 240
 5 5 25
5 5
50 7 375
25 7 175

25 7
20 9 355
15 7
20 9 285
10 7
20 9 250

balance
units cost total
20 4 80
20 4
40 5 280
20 4
30 5 230
5 4 20

5 4
50 7 370
5 4
20 7 160
20 9
20 7
5 4 340
5 4
20 7
10 9 250
5 4
20 7
5 9 205
lcm method item wi group wise

2000
1190
3150
360
6700 7120
12300
7400
19700 23800

26400 30920
lcm method item wi group wise

7120

23800

30920
6B1 20x7 20x8

net sales 22140 25220

beginning inventory 4790 5280
purchases 18300 19710
cost of goods available for sale 23090 24990

ending inventory 5280 5610

gross profit 4330 5840
operating expenses 2310 2790
net profit 2020 3050

Ending inventory

ending inventory as per p/l account 5230 5410

add:merchandise shipped 290
goods shipped 630
5860 5700
less: merchandise shipped to customer 420
goods received on consignment 160
1340 recorded as 1430 90
Ending inventory 5280 5610

6B2

beginning inventory 20 2300 46000

purchase
40 2400 96000
50 2500 125000
60 2700 162000
30 2800 84000
467000
cost of goods available for sale 513000

ENDING INVENTORY
FIFO LIFO
cost of goods available for sale 513000 cost of goods available for sale
less: ending inventory 28000 ending inventory
cost of goods sold 485000 cost of goods sold
gross profit 161000 gross profit
operating expenses 58000 operating expenses
net profit 103000 net profit

6b3 Perpetual inventory card(FIFO)

Purchase sale
date units rate total units cost
1-Feb
4-Feb 50 142 7100

7-Feb 20 140
10 142
10-Feb 60 145 8700

14-Feb 20 142

20-Feb 30 147 4410

26-Feb 20 142
20 145
Feb-29 80 148 11840
Feb-29

Perpetual inventory card(LIFO)

Purchase sale
date units rate total units cost
1-Feb
4-Feb 50 142 7100

7-Feb 30 142

10-Feb 60 145 8700

14-Feb 20 145

20-Feb 30 147 4410

 26-Feb 30 147
10 145

Feb-29 80 148 11840

6b4 quantity cost market price

Product group I
A134 210 450 94500 480 100800
A156 140 530 74200 670 93800
N278 65 480 31200 520 33800
P345 83 510 42330 360 29880
Product group II 242230
R098 13 650 8450 800 10400
R112 17 720 12240 760 12920
T034 26 680 17680 740 19240
T041 19 610 11590 780 14820
49960

6b5 FIFO
sales 50000 28 1400000 sales

beginning inventory 10000 18 180000 beginning invento

purchases 15000 19 285000 purchases

10000 21 210000
20000 22 440000
10000 23 230000
ending inventory ending inventory
10000 23 230000
5000 22 110000

cost of goods sold 1005000 cost of goods sold

gross profit 395000 gross profit
operating expenses 185000 operating expenses
profit before tax 210000 profit before tax
income tax 84000 income tax
profit after tax 126000 profit after tax
effect of purchase

sales 50000 28 1400000 sales

beginning inventory 10000 18 180000 beginning invento

purchases 15000 19 285000 purchases

10000 21 210000
20000 22 440000
10000 23 230000
15000 25 375000
ending inventory ending inventory
5000 22 110000
10000 23 230000
15000 25 375000
cost of goods sold 1005000 cost of goods sold
gross profit 395000 gross profit
operating expenses 185000 operating expenses
profit before tax 210000 profit before tax
income tax 84000 income tax
profit after tax 126000 profit after tax
 Profit and loss account
20x7 20x8
Net sales 21610 25750
add: revenue pertai 530
less:revenue pertaining to mer 530
22140 25220
purchases 18300 19420
add: merchandise shipped 290
18300 19710

total net profit before and after revision total

before revision 1440 3720 5160
after revision 2020 3050 5070
difference 580 -670 -90

WAC
f goods available for sale 513000 cost of goods available for sale
10 2300 23000 ending inventory 10 2565
f goods sold 490000
 156000 gross profit
ting expenses 58000 operating expenses
98000 net profit

balance
total units cost total
20 140 2800
20 140
20 142 9900

4220 40 142 5680

40 142
60 145 14380
2840 20 142
60 145 11540
20 142
60 145
30 147 15950
40 145
5740 30 147 10210
40 145
30 147
80 148 22050

Journal entries
14-Feb 1 Debtors 3200
balance sales 3200
total units cost total sold 20 units on credit
20 140 2800
20 140 2 cost of goods sold 2900
50 142 9900 merchandise inventory
4260 20 140 cost of 20 units sold to Jain brothers
20 142 5640
20 140
20 142
60 145 14340
2900 20 140
20 142
40 145 11440
20 140
20 142
40 145
 30 147 15850
20 140
5860 20 142
30 145 9990
20 140
20 142
30 145
80 148 21830

sales commission delivery charges lcm method item wisgroup wise

10080 90720 90720
9380 84420 74200
3380 30420 30420
2988 26892 26892
232452 222232 232452
2080 8320 260 8060 8060
2584 10336 10336 10336
3848 15392 15392 15392
2964 11856 11856 11590
45644 45378 45644

267610 278096

LIFO
50000 28 1400000 lifo for income tax reporting and fifo for shareholder reporting.

10000 18 180000

15000 19 285000
10000 21 210000
20000 22 440000
10000 23 230000

10000 18 180000
5000 19 95000

f goods sold 1070000

330000
ting expenses 185000
145000
58000
87000
 50000 28 1400000

10000 18 180000

15000 19 285000
10000 21 210000
20000 22 440000
10000 23 230000
15000 25 375000

10000 18 180000
15000 19 285000
5000 21 105000
f goods sold 1150000
250000
ting expenses 185000
65000
26000
39000
513000
25650
487350
158650
58000
100650

2900
hareholder reporting.
6c1
20x3 20x4

sales 542900 438300

Beginning inventory 73200 73700

net purchase 481700 398100

554900
ending inventory 65900 54300
add: goods sent on consignment 2400
add: goods shipped 4100
cost of merchandise not included 3700
less wrong recording -1800
correct ending inventory 73700 54900

revised p/l account

net sales 538600 442600
beginning inv 73200 73700
purchases 485800 394000
cost of goods available for sale 559000 467700
ending inventory 73700 54900
cost of goods sold 485300 412800
gross profit 53300 29800
operating expenses 28700 31200
net profit/loss 24600 -1400

notes
sales 542900 438300
add: revenue pertaining to merchandise shipped 4300
deduct:revenue pertaining to merchandise shipped 4300
538600 442600

purchases 481700 398100

add: merchandise shipped 4100
deduct:merchandise shipped 4100
485800 394000

net profit before and after revision total

before revision 25200 -2600 22600
after revision 24600 -1400 23200
difference 600
6c2
units
sales 90 1600 144000

beginning inventory 20 1000 20000

purchases
march 20 1100 22000
june 10 1200 12000
august 30 1300 39000
november 20 1400 28000
101000
cost of goods available for sale 121000
less: ending inventory 12100
108900
GP on sales 35100
operating expenses 16000
net profit 19100

FIFO
cost of goods available for sale 121000
less: ending inventory 10 1400 14000
cost of goods sold 107000
gross profit 37000
operating expenses 16000
net profit 21000

LIFO
cost of goods available for sale 121000
less: ending inventory 10 1000 10000
cost of goods sold 111000
gross profit 33000
operating expenses 16000
net profit 17000

WAC
cost of goods available for sale 121000
less: ending inventory 10 1210 12100
cost of goods sold 108900
gross profit 35100
operating expenses 16000
net profit 19100
2
6c3 Perpetual inventory card(FIFO)
Purchase sold
date units rate total units cost total units

1-Nov 40
40
3-Nov 80 71 5680
80
8-Nov 40 70 30
50 71 6350
10-Nov 10 71 710 20
15-Nov 40 73 2920 20
40
17-Nov 20 71
30 73 3610 10
21-Nov 30 74 2220 10
30
26-Nov 30 76 2280 10
30
30
28-Nov 10 73 20
10 74 1470 30

Perpetual inventory card(LIFO)

Purchase sale
date units rate total units cost total units

1-Nov 40
3-Nov 80 71 5680 40
80

8-Nov 80 71 30
10 70 6380
10-Nov 10 70 700 20
15-Nov 40 73 2920 20
40
17-Nov 40 73 10
10 70
3620
21-Nov 30 74 2220 10
30
26-Nov 30 76 2280 10
30
30
28-Nov 20 76 1520 10
30
 30-Nov 10

Journal entries
8-Nov Debtors 8100
sales 8100
sold 90 units on credit

cost of goods sold 6380

merchandise inventory 6380
cost of 90 units sold to RRohini Company

26-Nov merchandise inventory 2280

creditors 2280
purchased goods on credit from Tanvir Company
balance
cost total

70 2800
70
71 8480
71 2130

71 1420
71
73 4340

73 730
73
74 2950
73
74
76 5230
74
76 3760

balance
cost total

70 2800
70
71 8480

70 2100

70 1400
70
73 4320
70 700

70
74 2920
70
74
76 5200
76
74
70 3680
 6c4
quantity cost market price
Product group I sales commission delivery charges
A087 130 210 27300 280 36400 3640 32760
C134 170 230 39100 300 51000 5100 45900
F169 100 250 25000 260 26000 2600 23400
J214 120 220 26400 200 24000 2400 21600
117800 123660
Product group II
P518 10 890 8900 920 9200 920 8280 100
S098 20 850 17000 970 19400 1940 17460 200
U126 35 720 25200 840 29400 2940 26460 350
Y376 10 780 7800 800 8000 800 7200 100
58900

total
 lcm method item wisgroup wise
delivery charges
27300
39100
23400
21600
111400 117800

8180 8180
17260 17000
26110 25200
7100 7100
58650 57480 58650

168880 176450
6c5
FIFO
unit rate
sales 20000 120 2400000
cost of goods sold:
beginning inventory 1000 70 70000
purchases 5000 75 375000
8000 76 608000
9000 80 720000
cost of goods available for sale 1773000
ending inventory 3000 80 240000

cost of goods sold 1533000

gross profit 867000
operating expenses 365000
profit before tax 502000
income tax 150600
profit after tax 351400

after purchase
unit rate
sales 20000 120 2400000

beginning inventory 1000 70 70000

purchases 5000 75 375000
8000 76 608000
9000 80 720000
4000 85 340000
cost of goods available for sale 2113000
ending inventory 3000 80 240000
4000 85 340000

cost of goods sold 1533000

gross profit 867000
operating expenses 365000
profit before tax 502000
income tax 150600
profit after tax 351400
 LIFO
unit rate
sales 20000 120 2400000
cost of goods sold:
beginning inventory 1000 70 70000
purchases 5000 75 375000
8000 76 608000
9000 80 720000
cost of goods available for sale 1773000
ending inventory 1000 70 70000
2000 75 150000
220000
cost of goods sold 1553000
gross profit 847000
operating expenses 365000
profit before tax 482000
income tax 144600
profit after tax 337400

after purchase
unit rate
sales 20000 120 2400000

beginning inventory 1000 70 70000

purchases 5000 75 375000
8000 76 608000
9000 80 720000
4000 85 340000
cost of goods available for sale 2113000
ending inventory 1000 70 70000
5000 75 375000
1000 76 76000
cost of goods sold 1592000
gross profit 808000
operating expenses 365000
profit before tax 443000
income tax 132900
profit after tax 310100
GIRIDHAR CLOTHING COMPANY

merchandise inventory 17200

purchase (a) 68900
purchase (b) 3100
cost of goods available for sale 89200
Sales 98000
less: gross profit @20% 19600
cost of goods sold 78400
closing inventory 10800
estimated salvage 500
insurance claim 10300

percent increase in selling price

cost of goods available for sale 89200
sales 98000
less: price increase of 2% 1921
reviseed sales 96079
gross profit 20% 19215
cost of goods sold 76864
estimated ending inventory 12336
estimated salvage 500
insurance claim 11836

MURUGAN AUTOMOBILE COMPANY

sales 12000

beginning inventory 3000

manufacturing cost 8800
11800
ending inventory 1500
cost of goods sold 10300
gross profit 1700
operating expenses 490
operating profit 1210

in this method each element of cost is taken separately and fixed cost is taken as a whole not based on units.

internal system is showing more profit so this is good for the company as it increases earnings per share but lower p
 cost of goods available for sale 89200
amount of inventory loss 500
salvage 500
estimated ending inventory 1000
cost of goods sold 88200
sales 98000
gross profit 9800
implicit gross profit rate 10%

AN AUTOMOBILE COMPANY

manufacturing cost
materials 6*1000 6000
conversion1.5*1000 1500
fixed production ove 1300
8800

t is taken as a whole not based on units.

ny as it increases earnings per share but lower profit in profit and loss will save taxes and there will be less dividend payment as well.
ividend payment as well.