Question

Use the following information for problems #35-40 HuCo begins operations in 20X4, uses the periodic method...

Use the following information for problems #35-40

HuCo begins operations in 20X4, uses the periodic method and makes the following merchandise purchases:

20X4 Total Units Unit Cost Total Cost

April 900 $6 $5,400

September 1,300 7 9,100

20X5

March 1,100 $8 $8,800

November 500 10 5,000

39. If HuCo uses FIFO costing and sold 1,800 units each year, what is its 20X5 cost of goods sold?

A.) $14,200 B.) $10,700 C.) $14,600 D.) $10,300

40. HuCo, which used weighted average costing, has 700 units in 20X4 ending inventory. If HuCo sells 1,600 units in 20X5, what is its cost of goods sold (round unit costs in the computation to the nearest penny)?

A.) $13,800 B.) $11,040 C.) $11,760 D.) $12,816

Homework Answers

Answer #1
Req 39.
Answer is C. 14600
Explanation:
Beginning Inventory as per FIFO in 400 units @ 7: 2800
Purchase of Mar1: 1100 units @8: 8800
Purchase of Nov: 500 units @ 10: 5000
Cost of goods sold for 2015:
Beginning inventory 2800
Purchase of Mar 8800
Purchase of Nov 300 units 3000
COGS 14600
Req 40.
Answer is D. $ 12816
Explanation:
Average cost of 2004 (5400+9100)/2200 = 6.591
2005
Average cost per unit (700*6.591+8800+5000)/2300 = 8.006
COGS for 2005: 1600*8.006 = 12810
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