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Business LibreTexts

6: Assigning Costs to Merchandise

  • Page ID
    20105
    • girl-160172__340.png
    • Contributed by Henry Dauderis and David Annand
    • Athabasca University
    • Sourced from Lyryx Learning

    learning objectives

    • LO1 – Calculate cost of goods sold and merchandise inventory using specific identification, first-in first-out (FIFO), and weighted average cost flow assumptions — perpetual.
    • LO2 – Explain the impact on financial statements of inventory cost flows and errors.
    • LO3 – Explain and calculate lower of cost and net realizable value inventory adjustments.
    • LO4 – Estimate merchandise inventory using the gross profit method and the retail inventory method.
    • LO5 – Explain and calculate merchandise inventory turnover.
    • LO6 – Calculate cost of goods sold and merchandise inventory using specific identification, first-in first-out (FIFO), and weighted average cost flow assumptions — periodic.