![]() 2 - Purchased merchandise inventory on credit from Tighe, $4,100. Transactions in December that affected purchases and cash payments were as follows: Number 111 131 161 171 Account Cash Merchandise Inventory Prepaid Insurance Office Supplies Number 181 211 564 583 Account Equipment Accounts Payable Rent Expense Utilities Expense Number Account Number Account 111 Cash 181 Equipment 131 Merchandise Inventory 211 Accounts Payable 161 Prepaid Insurance 564 Rent Expense 171 Office Supplies 583 Utilities Expense \begin\\ The general ledger of Sparkling Lake Golf Shop includes the following selected accounts, along with their account numbers: Which method of inventory costing produces the highest bonus for the manager? ![]() The company’s manager earns a bonus based on a percent of gross profit.(For specific identification, units sold consist of 600 units from beginning inventory, 300 from the February 10 purchase, 200 from the March 13 purchase, 50 from the August 21 purchase, and 250 from the September 5 purchase.) Date ![]() It entered into the following calendar-year purchases and sales transactions. Montoure Company uses a perpetual inventory system. If the company’s manager earns a bonus based on a percent of gross profit, which method of inventory costing will the manager likely prefer?.(Round all amounts to cents.)Ĭompute gross profit earned by the company for each of the four costing methods in part 3. (For specific identification, the May 9 sale consisted of 80 units from beginning inventory and 100 units from the May 6 purchase the May 30 sale consisted of 200 units from the May 6 purchase and 100 units from the May 25 purchase.) DateĬompute cost of goods available for sale and the number of units available for sale.Ĭompute the number of units in ending inventory.Ĭompute the cost assigned to ending inventory using ( a) FIFO, ( b) LIFO, ( c) weighted average, and ( d) specific identification. ![]() Aloha Company uses a perpetual inventory system. ![]()
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