The units of an item available for sale during the year were as follows: Jan. 1

Question

The units of an item available for sale during the year were as follows: Jan. 1 Inventory 20 units at $41 Feb. 17 Purchase 12 units at $42 Jul. 21 Purchase 11 units at $45 Nov. 23 Purchase 8 units at $47 There are 10 units of the item in the physical inventory at December 31. The periodic inventory system is used. Round average unit cost to one decimal and final answers to the nearest whole dollar, if required. a. Determine the inventory cost by the first-in, first-out method. $ b. Determine the inventory cost by the last-in, first-out method. $ c. Determine the inventory cost by the weighted average cost method. $

Explanation / Answer

Solution a:

Solution b:

Solution c:

Computation of COGS and ending inventory - Periodic FIFO Particulars Cost of goods available for sale Cost of goods sold Ending Inventory Nos of units Unit Cost Cost of goods available for sale Nos of units sold Unit Cost Cost of goods sold Nos of units in ending inventory Unit Cost Ending inventory Beginning inventory 20 $41.00 $820 20 $41.00 $820.00 Purchases: 17-Feb 12 $42.00 $504 12 $42.00 $504.00 21-Jul 11 $45.00 $495 9 $45.00 $405.00 2 $45.00 $90.00 23-Nov 8 $47.00 $376 8 $47.00 $376.00 Total 51 $2,195 41 $1,729.00 10 $466.00

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