Determine the two limits to market value ie the ceiling and

Question

Question 1

Headland Company uses a periodic inventory system. For April, when the company sold 560 units, the following information is available.

	Units	Unit Cost	Total Cost
April 1 inventory	240	$27	$ 6,480
April 15 purchase	370	32	11,840
April 23 purchase	390	35	13,650
	1,000		$31,970

Compute the April 30 inventory and the April cost of goods sold using the FIFO method.

Question 2

Sandhill Company uses a periodic inventory system. For April, when the company sold 600 units, the following information is available.

	Units	Unit Cost	Total Cost
April 1 inventory	350	$24	$ 8,400
April 15 purchase	370	29	10,730
April 23 purchase	280	31	8,680
	1,000		$27,810

Compute the April 30 inventory and the April cost of goods sold using the LIFO method.

Question 3

Presented below is information related to Sarasota Inc.'s inventory, assuming Sarasota uses lower-of-LIFO cost-or-market.

(per unit)	Skis	Boots	Parkas
Historical cost	$235.60	$131.44	$65.72
Selling price	262.88	179.80	91.45
Cost to distribute	23.56	9.92	3.10
Current replacement cost	251.72	130.20	63.24
Normal profit margin	39.68	35.96	26.35

Determine the following:

(a) The two limits to market value (i.e., the ceiling and the floor) that should be used in the lower-of-cost-or-market computation for skis.

(b) The cost amount that should be used in the lower-of-cost-or-market comparison of boots.

(c) The market amount that should be used to value parkas on the basis of the lower-of-cost-or-market.

Question 4

A fire destroys all of the merchandise of Indigo Company on February 10, 2017. Presented below is information compiled up to the date of the fire.

Inventory, January 1, 2017	$411,600
Sales revenue to February 10, 2017	1,990,300
Purchases to February 10, 2017	1,145,430
Freight-in to February 10, 2017	63,700
Rate of gross profit on selling price	30%

What is the approximate inventory on February 10, 2017?