During the year ended 30 June 2014, TooBakko Ltd sold each unit of its goods at $9. Purchases and sales of the goods are shown below. Ignore GST.
2013
July 1 Inventory on hand 200 units @ $5.00 each
30 Sales 120 units
Aug. 25 Purchases 300 @ $5.25
30 Sales 250 units
Sept. 3 Purchases 450 units @ $5.30
10 Purchases returns 50 damaged units from 3 September purchase
30 Sales 300 units
Oct. 5 Purchases 300 units § $5.40
Dec. 8 Purchases 250 units at $5.45
11 Sales 500 units
2014
Feb. 21 Purchases 150 units @ $5.50
Marc 18 Purchases 100 units at $5.60
April 30 Sales 300 units
May 2 Sales returns 30 unitsfrom 30 April sales, goods returned to inventory
4 Purchases 250 units @ $5.70
June 6 Purchases 300 units @ $5.85
30 Sales 460 units
TooBakko Ltd uses a perpetual inventory system.
Required
- Using dollars and cents in appropriate inventory records, determine the cost of the inventory at 30 June 2014 under the following inventory cost flow assumptions: (1) FIFO (2) Moving average (round to the nearest cent).
- Assuming that a physical count at 30 June 2014 determined that only 300 units remained in inventory, prepare the journal entry to record the fact that some units had gone missing.
- Using the moving average method, prepare the Inventory Control, Cost of Sales and Sales accounts CT-account format), assuming that these accounts are balanced yearly on 30 June. Assume as well that the physical count of inventory was as mentioned in requirement B above.
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