Jaywall Corporation, Which Uses a Perpetual Inventory System, Recorded the Following

question 59

Essay

Jaywall Corporation, which uses a perpetual inventory system, recorded the following inventory transactions during 20X3. $$\begin{array} { | l | l | r | r | r | r | } \hline & & & \text { Purchases } & & \text { Sales } \\\hline \text { Price/Unit } & & \text { Units } & \text { Unit Cost } & \text { Units } & \text { Selling } \\\hline \text { April 1 } & \text { Beginning inventory } & 45 & \$ 8 & & \\\hline 25 & \text { Purchase } & 150 & 9 & & \\\hline \text { May 4 } & \text { Purchase } & 65 & 10 & & \\\hline 16 & \text { Sale } & & & 120 & \$ 16 \\\hline \text { June 4 } & \text { Purchase } & 50 & 12 & & \\\hline\end{array}$$ (a) Using the FIFO cost formula, calculate the amount of the cost of goods sold for the quarter ended June 30. (Show calculations) (b) Using the average cost formula, calculate the amount of ending inventory at June 30 . (Show calculations)

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Definitions:

Actual Manufacturing Overhead Cost

The actual costs incurred for indirect manufacturing expenses, such as utilities, rent, and maintenance.

Year

A period of time consisting of 12 months or 365 days, used as a basic unit for measuring time in relation to the earth's orbit around the sun.

Cost of Goods Available for Sale

The total cost of inventory that a business has ready for sale, comprising both beginning inventory plus the cost of goods manufactured.

Overapplied

A situation where the allocated manufacturing overhead cost exceeds the actual manufacturing overhead costs incurred, resulting in an apparent surplus.