requirement 2. determine the amount that would be reported in ending merchandise inventory on october 15…

requirement 2. determine the amount that would be reported in ending merchandise inventory on october 15 using the lifo inventory - costing method. enter the transactions in chronological order, calculating new inventory on - hand balances after each transaction. once all of the transactions have been entered into the perpetual record, calculate the quantity and total cost of merchandise inventory purchased, sold, and on hand at the end of the period. (enter all amounts to the nearest cent $xx.xx. for inventory on hand enter the oldest inventory layers first. for cost of goods sold enter the inventory layers in the order in which they are removed from inventory.)\n\n| date | purchases | | | cost of goods sold | | | inventory on hand | | |\n| ---- | ---- | ---- | ---- | ---- | ---- | ---- | ---- | ---- | ---- |\n| | quantity | unit cost | total cost | quantity | unit cost | total cost | quantity | unit cost | total cost |\n| october 2 | | | | | | | | | |\n| 6 | | | | | | | | | |\n| 8 | | | | | | | | | |\n| 13 | | | | | | | | | |\n| 14 | | | | | | | | | |\n| totals | | | | | | | | | |\n\npurchases and sales\noctober 2 purchased 12 gallons @ $2.20 each\noctober 6 purchased 2 gallons @ $2.35 each\noctober 8 sold 4 gallons of milk to a customer\noctober 13 purchased 4 gallons @ $2.60 each\noctober 14 sold 5 gallons of milk to a customer

requirement 2. determine the amount that would be reported in ending merchandise inventory on october 15 using the lifo inventory - costing method. enter the transactions in chronological order, calculating new inventory on - hand balances after each transaction. once all of the transactions have been entered into the perpetual record, calculate the quantity and total cost of merchandise inventory purchased, sold, and on hand at the end of the period. (enter all amounts to the nearest cent $xx.xx. for inventory on hand enter the oldest inventory layers first. for cost of goods sold enter the inventory layers in the order in which they are removed from inventory.)\n\n| date | purchases | | | cost of goods sold | | | inventory on hand | | |\n| ---- | ---- | ---- | ---- | ---- | ---- | ---- | ---- | ---- | ---- |\n| | quantity | unit cost | total cost | quantity | unit cost | total cost | quantity | unit cost | total cost |\n| october 2 | | | | | | | | | |\n| 6 | | | | | | | | | |\n| 8 | | | | | | | | | |\n| 13 | | | | | | | | | |\n| 14 | | | | | | | | | |\n| totals | | | | | | | | | |\n\npurchases and sales\noctober 2 purchased 12 gallons @ $2.20 each\noctober 6 purchased 2 gallons @ $2.35 each\noctober 8 sold 4 gallons of milk to a customer\noctober 13 purchased 4 gallons @ $2.60 each\noctober 14 sold 5 gallons of milk to a customer

Answer

Explanation:

Step1: Record October 2 purchase

Purchased 12 gallons at $2.20 each. Inventory on - hand: Quantity = 12, Unit Cost = $2.20, Total Cost = 12×2.20 = $26.40

Date Purchases Quantity Purchases Unit Cost Purchases Total Cost Cost of Goods Sold Quantity Cost of Goods Sold Unit Cost Cost of Goods Sold Total Cost Inventory on Hand Quantity Inventory on Hand Unit Cost Inventory on Hand Total Cost
October 2 12 $2.20 $26.40 0 - 0 12 $2.20 $26.40

Step2: Record October 6 purchase

Purchased 2 gallons at $2.35 each. Inventory on - hand: Quantity = 12 + 2=14, Total Cost = 26.40+2×2.35 = 26.40 + 4.70=$31.10

Date Purchases Quantity Purchases Unit Cost Purchases Total Cost Cost of Goods Sold Quantity Cost of Goods Sold Unit Cost Cost of Goods Sold Total Cost Inventory on Hand Quantity Inventory on Hand Unit Cost Inventory on Hand Total Cost
October 2 12 $2.20 $26.40 0 - 0 12 $2.20 $26.40
October 6 2 $2.35 $4.70 0 - 0 14 - $31.10

Step3: Record October 8 sale

Sold 4 gallons. Using LIFO, we take from the most recent purchase. Cost of Goods Sold: Quantity = 4, Unit Cost = $2.35, Total Cost = 4×2.35 = $9.40 Inventory on - hand: Quantity = 14 - 4 = 10, Total Cost = 31.10-9.40 = $21.70

Date Purchases Quantity Purchases Unit Cost Purchases Total Cost Cost of Goods Sold Quantity Cost of Goods Sold Unit Cost Cost of Goods Sold Total Cost Inventory on Hand Quantity Inventory on Hand Unit Cost Inventory on Hand Total Cost
October 2 12 $2.20 $26.40 0 - 0 12 $2.20 $26.40
October 6 2 $2.35 $4.70 4 $2.35 $9.40 10 - $21.70

Step4: Record October 13 purchase

Purchased 4 gallons at $2.60 each. Inventory on - hand: Quantity = 10+4 = 14, Total Cost = 21.70+4×2.60 = 21.70 + 10.40=$32.10

Date Purchases Quantity Purchases Unit Cost Purchases Total Cost Cost of Goods Sold Quantity Cost of Goods Sold Unit Cost Cost of Goods Sold Total Cost Inventory on Hand Quantity Inventory on Hand Unit Cost Inventory on Hand Total Cost
October 2 12 $2.20 $26.40 0 - 0 12 $2.20 $26.40
October 6 2 $2.35 $4.70 4 $2.35 $9.40 10 - $21.70
October 13 4 $2.60 $10.40 0 - 0 14 - $32.10

Step5: Record October 14 sale

Sold 5 gallons. Using LIFO, we take 4 from the October 13 purchase and 1 from the October 2 purchase. Cost of Goods Sold: 4×2.60+1×2.20 = 10.40 + 2.20=$12.60 Inventory on - hand: Quantity = 14 - 5 = 9, Total Cost = 32.10-12.60 = $19.50

Answer:

The ending merchandise inventory on October 15 is $19.50.