Question

# You have the following information for Blossom Company. Blossom uses the periodic method of accounting for...

You have the following information for Blossom Company. Blossom uses the periodic method of accounting for its inventory transactions. Blossom only carries one brand and size of diamonds—all are identical. Each batch of diamonds purchased is carefully coded and marked with its purchase cost.

 March 1 Beginning inventory 140 diamonds at a cost of \$300 per diamond. March 3 Purchased 190 diamonds at a cost of \$340 each. March 5 Sold 180 diamonds for \$650 each. March 10 Purchased 360 diamonds at a cost of \$365 each. March 25 Sold 385 diamonds for \$700 each.

Assume that Blossom uses the FIFO cost flow assumption. Calculate cost of goods sold. How much gross profit would the company report under this cost flow assumption?

 Cost of goods sold \$enter a dollar amount \$enter a dollar amount

Assume that Blossom uses the LIFO cost flow assumption. Calculate cost of goods sold. How much gross profit would the company report under this cost flow assumption?

 Cost of goods sold \$enter a dollar amount \$enter a dollar amount

 Units Unit cost Total March 1 140 300 42000 March 3 190 340 64600 March 10 360 365 131400 Total 690 238000 Sales units 565 =180+385 Sales value 386500 =(180*650)+(385*700)
 1 Cost of goods sold 192375 =(140*300)+(190*340)+(565-140-190)*365 Gross profit 194125 =386500-192375 2 Cost of goods sold 200500 =(360*365)+(190*340)+(565-360-190)*300 Gross profit 186000 =386500-200500

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