Question

1. The following information was available from the inventory records of Crane Company for January:

				Units				Unit Cost			Total Cost
Balance at January 1					5000				$9.10			$45,500
	Purchases:
		January 6			5000				10.37			51,850
		January 26			5000				10.74			53,700
	Sales
		January 7			(2000	)
		January 31			(9000	)
Balance at January 31					4000

Assuming that Crane uses the periodic inventory system, what should be the cost of goods sold at January 31, using the weighted-average inventory method, rounded to the nearest dollar?

A. $108,372
B. $102,298
C. $110,770
D. $40,486

2. Transactions for the month of June were:

Purchases					Sales
June 1		(balance) 3150 @	$3.30		June 2		2480
3		8730 @	3.20		6		6390
7		4820 @	3.40		9		4000
15		7130 @	3.50		10		1520
22		2080 @	3.60		18		5590
					25		830

Assuming that perpetual inventory records are kept in dollars, the COGS on a LIFO basis is

A. $69,813
B. $68,058
C. $67,349
D. $67,251

3. Bonita Industries has the following items at year-end:

	Cash in bank	$44,000
	Petty cash	550
	Short-term paper with maturity of 6 months	10,200
	Postdated checks	1,940

Bonita should report cash and cash equivalents of

A. $54,750
B. $44,550
C. $52,750
D. $56,690

Answer 1

	Units	Unit cost	Total
Balance at January 1	5000	9.1	45500
6-Jan	5000	10.37	51850
26-Jan	5000	10.74	53700
Total	15000		151050
Weighted-average cost=151050/15000= $10.07
Cost of goods sold = 11000*10.07= $110770
Option C is correct
2
COGS=(2480*3.3)+(6390*3.2)+(4000*3.4)+(820*3.4)+(700*3.2)+(5590*3.5)+(830*3.6)=$69813
Option A is correct
3
Cash and cash equivalents=44000+550+10200= $54750
Option A is correct