7-11 Inventory Costing Methods Consider the following information This method individually identifies and records the cost of each item sold as part o
{"Image DocumentName": "Inventory Costing Methods", "Image ImageDescription": "Consider the following information. May 6  95 cost. May 3. May 5. May 6. May 8. Purchased 1 unit for  70. Purchased 1 more unit for  75. Purchased 1 more unit for  95. Sold 2 units for  125 each. May 5  75 cost. May 3  70 cost. Specific Identification. This method individually identifies and records the cost of each item sold as part of cost of goods sold. If the items sold were identified as the ones that cost  70 and  95, the total cost of those items (  =  165) would be reported as Cost of Goods Sold. The cost of the remaining item ( 75) would be reported as Inventory on the balance sheet at the end of the period. The specific identification method individually identifies and records the cost of each item sold as part of cost of goods sold. This method requires accountants to keep track of the purchase cost of each item. In the example just given, if the items sold were identified as the ones that cost  70 and  95, the total cost of those items (  =  165) would be reported as Cost of Goods Sold. The cost of the remaining item ( 75) would be reported as Inventory on the balance sheet at the end of the period. The specific identification method is used primarily to account for individually expensive and unique items. Toll Brothers, the country\u2019s leading builder of luxury homes, reports the costs of home construction using the specific identification method. Car Max, a national auto dealership, also uses specific identification.", "Image XResolution": "37", "Image YResolution": "37", "Image ResolutionUnit": "Pixels/Centimeter", "Image Software": "SlidePlayer", "Image YCbCrPositioning": "Centered"}