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Financial & Managerial Accounting
Found in: Page 266
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

Montoure Company uses a perpetual inventory system. It entered into the following calendar-year purchases and sales transactions. (For specific identification, units sold consist of 600 units from beginning inventory, 300 from the February 10 purchase, 200 from the March 13 purchase, 50 from the August 21 purchase, and 250 from the September 5 purchase.)

Date

Activities

Units acquired at cost

Units sold at retail

Jan 1

Beginning inventory

600 units @ $45.00 per unit

Feb 10

Purchases

400 units @ $42.00 per unit

March 13

Purchases

200 units @ $27.00 per unit

March 15

Sales

800 units @ $75.00 per unit

Aug 21

Purchases

100 units @ $50.00 per unit

Sep 5

Purchases

500 units @ $46.00 per unit

Sep 10

Sales

600 units @ $75.00 per unit

Total

1,800 units

1,400 units

Required: Compute the cost of goods available for sale and the number of units available for sale.

Units Available for sale: 1,800 units.

Cost of goods available for sale: $77,200.

See the step by step solution

Step by Step Solution

Definition of Financial Statements

Financial Statements can be defined as the different schedules reflecting summaries of the financial transactions of the business entity.

Cost of goods and units available for sale

Particular

Units

X

Per unit cost

=

Total cost

Jan 1

600

X

$45

=

$27,000

Feb 10

400

X

$42

=

$16,800

March 13

200

X

$27

=

$5,400

Aug 21

100

X

$50

=

$5,000

Sep 5

500

X

$46

=

$23,000

Total

1,800

$77,200

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