Question

# 1. Compute the value of the ending inventory using FIFO (First-in/First-out)'    Beginning Inventory    40...

1. Compute the value of the ending inventory using FIFO (First-in/First-out)'

Beginning Inventory    40 units @ \$20

First Purchase 50 units @ \$21

Second Purchase    50 units @ 22

Third Purchase 50 units @ \$23

Ending Inventory 38 units

2. Compute the value of the ending inventory using LIFO (Last-in/First-out)

First purchase    60 units @ \$44

Second Purchase 30 units @ \$48

Third Purchase    25 units @ \$42

Fourth Purchase    40 units @ \$40

Ending Inventory    72 units

3. The straight-line depreciation on an asset costing \$108,000, 15 year useful life and a salvage value of \$6,000.

(a) Compute the annual depreciation    (b) Compute the annual rate of depreciation.

4. Compute the double-declining depreciation on an asset which costs \$17,500, useful life of 4 years and a salvage value of \$1,500.

Compute the book value at the end of the second year.

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