Financial Accounting

Perpetual Inventory Using FIFO

Beginning inventory, purchase and sales data for portable DVD player

April 1 Inventory  75 units @$99

10 Sale 58 units

15 Purchase  43 units @ $103

20 Sale 26 units

24 Sale  14 units

30 Purchase 25 units @ $ 109

 

 

 

 

 

b.  Based upon the preceding data, would you expect the inventory to be higher or lower using the last-in, first-out method?

Q 2

Periodic Inventory by Three Methods

The units of an item available for sale during the year were as follows:

 

Jan. 1

Inventory

1,075 units @ $130

 

Feb. 17

Purchase

1,425 units @ $131

 

Jul. 21

Purchase

1,570 units @ $133

 

Nov. 23

Purchase

1,125 units @ $134

There are 1,200 units of the item in the physical inventory at December 31. The periodic inventory system is used. Do not round intermediate calculation and round final answer to nearest whole value.

a.  Determine the inventory cost by the first-in, first-out method.
$

b.  Determine the inventory cost by the last-in, first-out method.
$

c.  Determine the inventory cost by the weighted average cost method.
$

Q 3.

Bank Reconciliation

The following data were accumulated for use in reconciling the bank account of Mathers Co. for July:

1. Cash balance according to the company’s records at July 31 $20,010.

2. Cash balance according to the bank statement at July 31, $21,110.

3. Checks outstanding, $4,060.

4. Deposit in transit, not recorded by bank, $3,260.

5. A check for $480 in payment of an account was erroneously recorded in the check register as $840.

6. Bank debit memo for service charges, $60.

a.  Prepare a bank reconciliation

b.  If the balance sheet is prepared for Mathers Co. on July 31, what amount should be reported for cash?
$

c.  Must a bank reconciliation always balance (reconcile)?

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