Question

14. JiCo uses the periodic method. Its beginning inventory is $43,000, purchases are $321,000, F.O.B. destination, purchase returns are $17,000 and freight is $9,000. The balance in JiCo's ledger Purchases account is....

A.) $330,000 B.) $317,000 C.) $321,000 D.) $304,000

20. XoCo, which begins business in May and uses the perpetual method and moving average costing, shows the following data:

Purchases

May 4 1,000 @ $7

May 14 1,400 @ $8

May 19 2,000 @ $10

Sales

May 11 400 @ $11

May 21 1,500 @ $15

The balance in XoCo's inventory account on May 31 is....

A.) $22,125 B.) $20,833 C.) $21,705 D.) $23,875

Answer 1

14) Calculate balance in JiCo's ledger purchase account is :

Purchase account = 321000-17000 = 304000

So answer is d) $304000

20) Moving average method :

Date	Unit	Unit cost	Total cost	Unit	Unit cost	Cost of goods sold	Unit	Unit cost	Ending inventory cost
May 4	1000	7	7000				1000	7	7000
May 11				400	7	2800	600	7	4200
May 14	1400	8	11200				2000	7.7	15400
May 19	2000	10	20000				4000	8.85	35400
May 21				1500	8.85	13275	2500	8.85	22125

So answer is a) $22125