Specific Identification-Example Specific Identificaton Computations- Perpetual Inventory System Purchases Sales Balance Date Units Cost Total Units Cost Total Units Cost Total 8/1 10s90|$900 10【s90s900 8/3 15510051,500 15$100$1,500 2,400 The opening inventory consists of 10 units(@ S90/unit.180 $480 180 8/17 20$110$2,200 2Q|$110s2200 2.680 8/28 2$90|$180 12|s110s1,320 8s110$880 Totals $43600 34 $3,420 $1,180 Task Team of FUndaMientalactoUntING Business Sehool. Sun Yatsen niversity
11 Specific Identification-Example Purchases Sales Balance Date Units Cost Total Units Cost Total Units Cost Total 8/1 10 $ 90 $ 900 10 $ 90 $ 900 10 $ 90 $ 900 8/3 15 $ 100 $ 1,500 15 $ 100 $ 1,500 25 $ 2,400 8/14 8 $ 90 $ 720 2 $ 90 $ 180 12 $ 100 $ 1,200 3 $ 100 $ 300 5 $ 480 2 $ 90 $ 180 3 $ 100 $ 300 8/17 20 $ 110 $ 2,200 20 $ 110 $ 2,200 25 $ 2,680 8/28 2 $ 90 $ 180 3 $ 100 $ 300 12 $ 110 $ 1,320 8 $ 110 $ 880 Totals 45 $ 4,600 34 $ 3,420 11 $ 1,180 Specific Identificaton Computations - Perpetual Inventory System The opening inventory consists of 10 units @ $90/unit
Specific ldentification-Example Specific Identificaton Computations-Perpetual Inventory System Purchases Sales Balance Date Units Total Units Cost Total Units Cost Total 8/1 10s90s900 10s90s900 10|$90$900 8/3 15|$100$1,500 15|$100$1500 25 $2,400 8/14 180 This results in two layers of Additionalunits re 300 purchased s100/unit inventory. 180 100|$300 8/17 20S110$2200 20$11052200 2,680 8/28 2$90|$180 12$110s1,320 8s110$880 Totals $4,600 34 340 $1,180 Task Team of FUndaMientalactoUntING Business Sehool. Sun Yatsen niversity 12
12 Specific Identification-Example Purchases Sales Balance Date Units Cost Total Units Cost Total Units Cost Total 8/1 10 $ 90 $ 900 10 $ 90 $ 900 10 $ 90 $ 900 8/3 15 $ 100 $ 1,500 15 $ 100 $ 1,500 25 $ 2,400 8/14 8 $ 90 $ 720 2 $ 90 $ 180 12 $ 100 $ 1,200 3 $ 100 $ 300 5 $ 480 2 $ 90 $ 180 3 $ 100 $ 300 8/17 20 $ 110 $ 2,200 20 $ 110 $ 2,200 25 $ 2,680 8/28 2 $ 90 $ 180 3 $ 100 $ 300 12 $ 110 $ 1,320 8 $ 110 $ 880 Totals 45 $ 4,600 34 $ 3,420 11 $ 1,180 Specific Identificaton Computations - Perpetual Inventory System This results in two layers of inventory. Additional units re purchased @ $100/unit
Specific Identification-Example Specific identificaton Computations-Perpetual Inventory System Purchases Balance Date Units Cost Total Units Cost Total Units Cost Total 8/1 10|S90$900 10$90$900 90$900 8/3 15$100|$1,500 15|$100s1,500 $2,400 8/14 8s90$720 2|s90$180 12$100$1,200 3|s100$300 5 480 180 On August 14, 20 units are sold. Eight of these units came from 100s 300 the opening inventory and the remaining 12 units came from 11052200 the August 3 purchase. 2,680 100$300 12|S110s1,320 8s11|s Totals $4600 $3420 $1180 Task Team of FUndaMientalactoUntING Business Sehool. Sun Yatsen niversity 13
13 Specific Identification-Example Purchases Sales Balance Date Units Cost Total Units Cost Total Units Cost Total 8/1 10 $ 90 $ 900 10 $ 90 $ 900 10 $ 90 $ 900 8/3 15 $ 100 $ 1,500 15 $ 100 $ 1,500 25 $ 2,400 8/14 8 $ 90 $ 720 2 $ 90 $ 180 12 $ 100 $ 1,200 3 $ 100 $ 300 5 $ 480 2 $ 90 $ 180 3 $ 100 $ 300 8/17 20 $ 110 $ 2,200 20 $ 110 $ 2,200 25 $ 2,680 8/28 2 $ 90 $ 180 3 $ 100 $ 300 12 $ 110 $ 1,320 8 $ 110 $ 880 Totals 45 $ 4,600 34 $ 3,420 11 $ 1,180 Specific Identificaton Computations - Perpetual Inventory System On August 14, 20 units are sold. Eight of these units came from the opening inventory and the remaining 12 units came from the August 3 purchase
Specific ldentification-Example Specific Identificaton Computations-Perpetual Inventory System Purchases Sales Balance Date Units Cost Total Units Cost Total Units Total 10s90|$900 10| 900 8/3 15|$100$1,500 15|$100$1500 2,400 8/14 8|S90720 2|$90$180 12|100$1,200 2|$90|$180 3s100$300 This leaves 2 units remaining from the 205 110s 2, 200 2,680 original inventory and 3 units remaining 3s 1001s300 Totals from the August 3 purchase. 110$880 $1,180 Task Team of FUndaMientalactoUntING Business Sehool. Sun Yatsen niversity 14
14 Specific Identification-Example Purchases Sales Balance Date Units Cost Total Units Cost Total Units Cost Total 8/1 10 $ 90 $ 900 10 $ 90 $ 900 10 $ 90 $ 900 8/3 15 $ 100 $ 1,500 15 $ 100 $ 1,500 25 $ 2,400 8/14 8 $ 90 $ 720 2 $ 90 $ 180 12 $ 100 $ 1,200 3 $ 100 $ 300 5 $ 480 2 $ 90 $ 180 3 $ 100 $ 300 8/17 20 $ 110 $ 2,200 20 $ 110 $ 2,200 25 $ 2,680 8/28 2 $ 90 $ 180 3 $ 100 $ 300 12 $ 110 $ 1,320 8 $ 110 $ 880 Totals 45 $ 4,600 34 $ 3,420 11 $ 1,180 Specific Identificaton Computations - Perpetual Inventory System This leaves 2 units remaining from the original inventory and 3 units remaining from the August 3 purchase
First-Ing First-Out (FIFO) Q Based on the assumption that the items are sold in the order acquired. ◆ When a sale occurs n The earliest units purchased are charged to Cost of Goods sold n The cost of the most recent purchases remain in inventory Task Team of FUndaMientalactoUntING Business Sehool. Sun Yatsen niversity 15
15 ⧫Based on the assumption that the items are sold in the order acquired. ⧫When a sale occurs: The earliest units purchased are charged to Cost of Goods Sold. The cost of the most recent purchases remain in inventory First-In, First-Out (FIFO)