Goiter's Delight, Inc., carries a line of titanium putters. Golfer's Delight, Inc., uses the FIFO method and a perpetual invento
ry system. The sales price oca entory system. The sales price of each putter is $195. Company records indicate the following activity for putters for the month of July. Date Item Quantity Unit Cost
July 1 Balance 6 $110
7 Purchase 12 $ 112
11 Sale 17
19 Purchase 15 $ 114
28 Sale 12
Requied:
1. Prepare a perpetual inventory record for the putters to determine the amount Golfer's Delight, Inc., should report for ending inventory and cost of goods sold using the FIFO method.
2. Journalize the inventory transactions for Golfer's Delight, Inc., using the FIFO method. Assume all purchases and sales are on account.
Product width basically refers to how many different product lines are sold, and obviously a supermarket sells hundreds of product line, while a vending machine generally sells soft drinks or snacks, which is only 1 product line.
The product depth refers to the amount of products sold, and a supermarket is much larger than a vending machine so it can sell many more products.
Explanation: The marginal utility from consumption of the third unit of goods is gotten by taking the difference between the total utility derived from three units of goods and the total utility derived from two units of goods.
Total utility from three units = 84 utils
Total utility from two units = 74 utils
84 - 74 = 10 utils which is the marginal utility of the third unit.
