Question

Question:Boston Cycles started October with 12 bicycles that cost \(42 each. On October 16, Boston bought 40 bicycles at \)68 each. On October 31, Boston sold 34 bicycles for\(100 each.

Requirements

1. Prepare Boston Cycle’s perpetual inventory record assuming the company usesthe specific identification inventory costing method. Assume that Boston sold 10bicycles that cost \)42 each and 24 bicycles that cost $68 each.

Short answer

The total cost of goods sold based on specific identification amounts to$2,052.

Step-by-step solution

Specific identification method

The specific identification method is an inventory costing method that estimates the inventory cost based on the particular units of inventory. This inventory method is used for unique inventory items such as jewelry, real estate, etc.

Perpetual inventory record based on the specific identification method

Date	Purchase / Opening inventory	Sale	Balance
	Unit	Cost	Amount	Unit	Cost	Amount	Unit	Cost	Amount
Oct 1	12	$42	$1,806				12	$42	$1,806
Oct 16	40	$68	$2,720				12 40	$42 $68	$4,526
Oct 31				10 24	$42 $68	$2,052	2 16	$42 $68	$1,172