Catlet Co. uses a periodic inventory system. Its records show the following for

Question

   Catlet Co. uses a periodic inventory system. Its records show the following for the month of May in which 65 units were sold.  

35

420

90

$935

  Compute the ending inventory at May 31 and cost of goods sold using the FIFO and LIFO methods.   

Date Explanation Units Unit Cost Total Cost May 1 Inventory 30   $ 8 $240 May 15 Purchases 25    11   275 May 24 Purchases

35

   12

420

        Totals

90

$935

Catlet Co. uses a periodic inventory system. Its records show the following for the month of May in which 65 units were sold. Compute the ending inventory at May 31 and cost of goods sold using the FIFO and LIFO methods.

Explanation / Answer

Cost of Goods Available for Sale = $1,128.50
FIFO
Ending Inventory
25 Units
25 x 14.15 = $353.75
Cost of Goods Sold
1,128.50 - 353.75 = $774.75

LIFO
Ending Inventory
25 Units
25 x 10.15 = $253.75
Cost of Goods Sold
1,128.50 - 253.75 = $874.75

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