Question

# FIFO Perpetual Inventory The beginning inventory at Dunne Co. and data on purchases and sales for...

FIFO Perpetual Inventory

The beginning inventory at Dunne Co. and data on purchases and sales for a three-month period ending June 30 are as follows:

Date Transaction Number
of Units
Per Unit Total
Apr. 3 Inventory 72 \$300 \$21,600
8 Purchase 144 360 51,840
11 Sale 96 1,000 96,000
30 Sale 60 1,000 60,000
May 8 Purchase 120 400 48,000
10 Sale 72 1,000 72,000
19 Sale 36 1,000 36,000
28 Purchase 120 440 52,800
June 5 Sale 72 1,050 75,600
16 Sale 96 1,050 100,800
21 Purchase 216 480 103,680
28 Sale 108 1,050 113,400

Required:

1. Record the inventory, purchases, and cost of merchandise sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the first-in, first-out method. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Goods Sold Unit Cost column and in the Inventory Unit Cost column.

Dunne Co.
Schedule of Cost of Goods Sold
FIFO Method
For the Three Months Ended June 30
Purchases Cost of Goods Sold Inventory
Date Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost
Apr. 3 \$ \$
Apr. 8 \$ \$
Apr. 11 \$ \$
Apr. 30
May 8
May 10
May 19
May 28
June 5
June 16
June 21
June 28
June 30 Balances \$ \$

2. Determine the total sales and the total cost of goods sold for the period. Journalize the entries in the sales and cost of goods sold accounts. Assume that all sales were on account.

 Record sale Accounts Receivable Sales Record cost Cost of Goods Sold Inventory

3. Determine the gross profit from sales for the period.
\$

4. Determine the ending inventory cost as of June 30.
\$

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