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Problem

Norman's Televisions produces television sets in three categories: portable, midsize, and flat-screen. On January 1, 2014, Norman adopted dollar-value LIFO and decided to use a single inventory pool. The company's January 1 inventory consists of:

Category Quantity Cost per Unit Total Cost
Portable 6,000 $100 $ 600,000
Midsize 8,000 250 2,000,000
Flat-screen 3,000 400 1,200,000
17,000 $3,800,000

During 2014, the company had the following purchases and sales.

Quantity Quantity Selling Price
Category Purchased Cost per Unit Sold per Unit
Portable 15,000 $110 14,000 $150
Midsize 20,000 300 24,000 405
Flat-screen 10,000 500 6,000 600
45,000 44,000

Instructions

(a) Compute ending inventory, cost of goods sold, and gross profit.
(b) Assume the company uses three inventory pools instead of one. Repeat instruction (a).

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M92793497

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