Learning Objective 5-4
1) Philipsburg Corporation sells hats to upscale retailers around the world. Information about inventory is contained in the table below. The company uses a LIFO perpetual inventory system.
Date
|
|
Number of Units
|
Unit Cost
|
Total Cost
|
January 1
|
Beginning inventory
|
500
|
$9.00
|
$4,500
|
January 13
|
Purchase
|
1,000
|
$10.00
|
$10,000
|
January 22
|
Purchase
|
1,400
|
$11.00
|
$15,400
|
Determine the gross profit for the period assuming that the only sale was 1,200 units for $35 each on January 15.
A) $30,200
B) $32,400
C) $36,540
D) $42,000
2) Head on Straight, Inc. sells hats to fine retailers across the world. It uses a FIFO perpetual inventory system. Inventory data is presented in the table below.
Date
|
|
Number of Units
|
Unit Cost
|
Total Cost
|
January 1
|
Beginning inventory
|
300
|
$100
|
$30,000
|
January 13
|
Purchase
|
400
|
$110
|
$44,000
|
January 22
|
Purchase
|
500
|
$120
|
$60,000
|
Determine the operating income for the period, assuming that 1,000 units were sold for $170 each. Operating expenses excluding cost of goods sold totaled $40,000.
A) $110,000
B) $16,000
C) $65,000
D) $20,000
3) Up Against the Wall, Inc. sells wallpaper to fine retailers across the world. It uses a LIFO perpetual inventory system. Inventory data is presented in the table below.
Date
|
|
Number of Units
|
Amount per unit
|
January 1
|
Beginning inventory
|
300
|
$100
|
January 13
|
Purchase
|
600
|
$110
|
January 22
|
Sale
|
500
|
$200
|
Determine the gross profit for the period.
A) $55,000
B) $45,000
C) $100,000
D) $48,000
4) Philipsburg Corporation sells mugs to fine retailers around the world. It uses a FIFO perpetual inventory system. Inventory data is presented in the table below.
Date
|
|
Number of Units
|
Unit Cost
|
Total Cost
|
January 1
|
Beginning inventory
|
300
|
$100
|
$30,000
|
January 13
|
Purchase
|
400
|
$110
|
$44,000
|
January 22
|
Purchase
|
500
|
$120
|
$60,000
|
Determine gross profit for the period, assuming that 1,000 units were sold for $170 each. Operating expenses excluding cost of goods sold totaled $40,000.
A) $80,000
B) $60,000
C) $40,000
D) $170,000
5) Philipsburg Corporation sells mugs to fine retailers around the world. It uses a FIFO perpetual inventory system. Inventory data is presented in the table below.
Date
|
|
Number of Units
|
Unit Cost
|
Total Cost
|
January 1
|
Beginning inventory
|
300
|
$100
|
$30,000
|
January 13
|
Purchase
|
400
|
$110
|
$44,000
|
January 22
|
Purchase
|
500
|
$120
|
$60,000
|
Determine operating income for the period, assuming that 1,000 units were sold for $170 each. Operating expenses excluding cost of goods sold totaled $40,000.
A) $40,000
B) $34,000
C) $22,000
D) $20,000
6) Putting on the Ritz, Inc. sells hats to upscale retailers around the world. Information about inventory is contained in the table below. The company uses a LIFO perpetual inventory system.
Date
|
|
Number of Units
|
Unit Cost
|
Total Cost
|
January 1
|
Beginning inventory
|
500
|
$9.00
|
$4,500
|
January 13
|
Purchase
|
1,000
|
$10.00
|
$10,000
|
January 22
|
Purchase
|
1,400
|
$11.00
|
$15,400
|
Determine the gross profit for the period assuming that the only sale was 1,200 units for $35 each on January 15.
A) $30,200
B) $32,400
C) $36,540
D) $42,000
7) Inventory information for Great Falls Merchandising, Inc. is provided below. Sales for the period were 2,800 units at $8 each. The company uses a FIFO periodic inventory system.
Date
|
|
Number of Units
|
Unit Cost
|
Total Cost
|
January 1
|
Beginning inventory
|
1,000
|
$3.00
|
$3,000
|
January
|
Purchase
|
600
|
$3.50
|
$2,100
|
February
|
Purchase
|
800
|
$4.00
|
$3,200
|
March
|
Purchase
|
1,200
|
$4.25
|
$5,100
|
Totals
|
|
3,600
|
|
$13,400
|
Determine the gross profit for the quarter ended March 31.
A) $15,400
B) $12,600
C) $12,400
D) $22,400
8) Inventory data for Missoula Merchandising, Inc. are provided below. Sales for the period were 2,800 units. Each sold for $8. The company maintains a weighted-average periodic inventory system.
Date
|
|
Number of Units
|
Unit Cost
|
Total Cost
|
January 1
|
Beginning inventory
|
1,000
|
$2.20
|
$2,200
|
January
|
Purchases
|
600
|
$3.50
|
$2,100
|
February
|
Purchases
|
800
|
$4.00
|
$3,200
|
March
|
Purchases
|
1,200
|
$4.25
|
$5,100
|
Totals
|
|
3,600
|
|
$12,600
|
Determine the gross profit for the quarter ended March 31.
A) $12,635
B) $12,600
C) $13,000
D) $22,400
9) Over the Top, Inc. sells hats to upscale retailers around the world. Information about inventory is contained in the table below. The company uses a FIFO perpetual inventory system.
Date
|
|
Number of Units
|
Unit Cost/Price
|
January 1
|
Beginning inventory
|
500
|
$9.00
|
January 13
|
Purchase
|
1,000
|
$10.00
|
January 22
|
Sale
|
1,200
|
$35.00
|
Determine the gross profit.
A) $42,000
B) $34,750
C) $30,500
D) $30,2500