Question

Park Company reported the following March purchases and sales data for its only product. Date Activities Units Acquired at Cost Units Sold at Retail Mar. 1 Beginning inventory 150 units @ $7.00 = $ 1,050 Mar. 10 Sales 90 units @$15 Mar. 20 Purchase 220 units @ $6.00 = 1,320 Mar. 25 Sales 145 units @$15 Mar. 30 Purchase 90 units @ $5.00 = 450 Totals 460 units $ 2,820 235 units Park uses a perpetual inventory system. For specific identification, ending inventory consists of 225 units, where 90 are from the March 30 purchase, 80 are from the March 20 purchase, and 55 are from beginning inventory. 1. Complete comparative income statements for the month of March for Park Company for the four inventory methods. Assume expenses are $1,600, and that the applicable income tax rate is 30%. (Round per unit costs to three decimal places. Round your answers to the nearest dollar amounts. Input all amounts as positive values. Omit the "$" sign in your response.) PARK COMPANY Income Statements For Month Ended March 31 Specific Identification Weighted Average FIFO LIFO Sales $ $ $ $ Cost of goods sold Gross profit Expenses Income before taxes Income tax expense Net income $ $ $ $

Answer 1

Answer:

(a) $1,385

(b) $1,445

(c) $1,560

(d) $1,320

Explanation:

Specific Identity___ Ending Inventory

60____ 420 ___ 90____ 630

140___ 840___ 80____ 480

35____ 175___ 55____ 275

235___ $1,435__ 225___ $1,385

(a) Specific identification COGS $1,435

Ending Inventory $1,385

(b) Weighted Average

Ending Inventory

6.1478 __ 225__ $1,383

COGS__ 235__ $1,445

(c) FIFO

Ending Inventory

20-Mar__ 135 __ 6__ 810

30-Mar__ 90___ 5__ 450

___________________ $1,260

Beginning Inv _150_ 7__ 1,050

20-Mar___ 85_ 6__ 510

COGS_____________ $1,560

(d) LIFO Ending Inventory

Beginning_ 150__ 7 __ 1,050

20-Mar___ 75__ 6 __ 450

_______________ $1,500

30-Mar__ 90__ 5__ 450

20-Mar 145_ 6__ 870

COGS_________ $1,320