Question
Only three canoes are offered, the Iroquois, Chippewa, and Winnebago, which cost $1,100,$1,400, and $2,100, respectively. Each canoe also comes as a kit and costs $450, $550, and $800 respectively. Custom paddles are also available and cost $45 and $75, for medium and large sizes. The beginning on April 1 is as follows: Iroquois-1canoe/2 kits Chippewa-2 canoes/2 kits; Winnebago-0 canoes/3 kits; and paddles-6 medium/6 large. The ending inventory on June 30 is as follows: Iroquois-2 canoes/1 kit; Chippewa-0 canoes/1 kit; Winnebago-2 canoes/1 kit; and paddles-6 medium/4 large. The following information is a summary of inventory purchased by the retail outlet during the three months(April through June):
Date of purchase Units Item Cost per unit
April 5 3 Iroquois canoe $1,100
3 Chippewa canoe $1,400
3 Winnebago canoe $2,100
May 1 3 Iroquois kit $450
2 Chippewa kit $550
1 Winnebago kit $800
8 Paddle medium $45
6 Paddle large $75
June 2 2 Chippewa kit $550
1 Winnebago kit $800
a. Find the cost of goods sold using the specific identification inventory method.
b. Find the cost of goods sold using the weighted-average inventory method.
c. Decorah Custom Canoes had net sales of $8,085 at cost for the month of April, and the ending inventory on April 30 was $14,645. Compute the beginning inventory on April 1 (Hint: based on what is listed in the case), and then find the average inventory at cost the turnover rate at cost for April.
Date of purchase Units Item Cost per unit
April 5 3 Iroquois canoe $1,100
3 Chippewa canoe $1,400
3 Winnebago canoe $2,100
May 1 3 Iroquois kit $450
2 Chippewa kit $550
1 Winnebago kit $800
8 Paddle medium $45
6 Paddle large $75
June 2 2 Chippewa kit $550
1 Winnebago kit $800
a. Find the cost of goods sold using the specific identification inventory method.
b. Find the cost of goods sold using the weighted-average inventory method.
c. Decorah Custom Canoes had net sales of $8,085 at cost for the month of April, and the ending inventory on April 30 was $14,645. Compute the beginning inventory on April 1 (Hint: based on what is listed in the case), and then find the average inventory at cost the turnover rate at cost for April.