Austin Company began year 2011 with 33000 units of product as of January 1 inven

Question

Austin Company began year 2011 with 33000 units of product as of January 1 inventory costing $17 each. It made successive purchases of its products in year 2011 as follows. The company uses a periodic inventory system. On Dec. 31, 2011 a physical count revealed 40000 units of products remained in inventory.
March 7- 38000 units @$19 each
May 25- 34000 units @ 22 each
Aug 1- 26000 units @ $26 each
Nov. 10- 22000 units @ $30 each
1. compute the number and total cost of the units available for sale
2. compute the amounts assigned to the 2011 ending inventory and the cost of goods sold (a) FIFO (b) LIFO and (c) weighted average

Explanation / Answer

Number of Units Cost Per Unit Value Beginning Inventory 33000 17 $561,000.00 March 7- 38000 units @$19 each 38000 19 $722,000.00 May 25- 34000 units @ 22 each 34000 22 $748,000.00 Aug 1- 26000 units @ $26 each 26000 26 $676,000.00 Nov. 10- 22000 units @ $30 each 22000 30 $660,000.00 Units Available for Sale (UAS) 153000 $3,367,000.00 FIFO 22000 30 $660,000.00 18000 26 $468,000.00 Ending Inventory – FIFO 40000 $1,128,000.00 Cost of Goods Sold (UAS – EI: FIFO) $2,239,000.00 LIFO 33000 17 $561,000.00 7000 19 $133,000.00 Ending Inventory – LIFO 40000 $694,000.00 Cost of Goods Sold (UAS – EI: LIFO) $2,673,000.00 Average Cost Average cost per unit $22.01 ($3,367,000.00/153,000) Ending Inventory – units 40000 Ending Inventory – Average cost $880,261.44 Cost of Goods Sold – (UAS – EI: Average Cost) $2,486,738.56 Short Form Answer: 1. Number of Units: 153,000 Total Costs of Units: $3,367,000.00 2. Ending Inventory - FIFO: $1,128,000.00 Ending Inventory - LIFO: $ 694,000.00 Ending Inventory - Avg.: $ 880,261.44

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