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Financial & Managerial Accounting
Found in: Page 261
Financial & Managerial Accounting

Financial & Managerial Accounting

Book edition 7th
Author(s) John J Wild, Ken W. Shaw, Barbara Chiappetta
Pages 1096 pages
ISBN 9781259726705

Short Answer

Refer to the information in QS 5-10 and assume the perpetual inventory system is used. Determine the costs assigned to ending inventory when costs are assigned based on specific identification. Of the units sold, eight are from the December 7 purchase and seven are from the December 14 purchase. (Round per unit costs and inventory amounts to cents.)

Ending Inventory totals $378.

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Step by Step Solution

Definition of Cost of Goods Manufactured

The total cost incurred by a business regarding the goods that are ready for sale is known as the cost of goods manufactured. It includes costs such as direct material, direct labor, and manufacturing overheads.

Ending inventory under specific identification method

Particular

Units

X

Per unit

=

Total cost

December 7

2

X

6

=

$12

December 14

13

X

12

=

$156

December 21

15

X

14

=

$210

Total

$378

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