Q32PGA_2 Futuristic Electronic Center beg... [FREE SOLUTION]

Chapter 6: Q32PGA_2 (page 369)

Futuristic Electronic Center began October with 65 units of merchandise inventory that cost $82 each. During October, the store made the following purchases:
Oct. 3 25 units @ $ 90 each
12 30 units @ $ 90 each
18 35 units @ $ 96 each
Futuristic uses the periodic inventory system, and the physical count at October 31 indicates that 80 units of merchandise inventory are on hand.
Requirements
2. Net sales revenue for October totaled $28,000. Compute Futuristic鈥檚 gross profit for October using each method.

Expert verified

Gross profit under:

FIFO: $21,770

LIFO: $21,040

Weighted Average: $21,400

$Gross margin = Total revenue - COGS = $ 28, 000 - $ 6, 230 = $ 21, 770$

$Gross Margin = Total Revenue - COGS = $ 28, 000 - $ 6, 960 = $ 21, 040$

$Gross margin = Total revenue - COGS = $ 28, 000 - $ 6, 600 = $ 21, 400$

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	2019	2018	2017
Net Sales Revenue	\( 220,000	\) 162,000	\( 176,000
Cost of Goods Sold:
Beginning Merchandise Inventory	\)22,000	\(29,000	\)46,000
Net cost of purchase	132,000	90,000	76,000
Cost of goods available for sale	154,000	119,000	122,000
Less: Ending Merchandise Inventory	32,000	22,000	29,000
Cost of goods sold	122,000	97,000	93,000
Gross Profit	98,000	65,000	83,000
Operating Expenses	72,000	38,000	48,000
Net Income	\( 26,000	\) 27,000	$ 35,000