Periodic Inventory by Three Methods; Cost of Merchandise Sold The units of an it

Question

Periodic Inventory by Three Methods; Cost of Merchandise Sold The units of an item available for sale during the year were as follows: an. Inventory Mar. 10 Purchase Aug. 30 Purchase Dec. 12 Purchase There are 80 units of the item in the physical inventory at December 31·The periodic inventory system is used. Determine the inventory cost and the cost of merchandise sold by three methods. Round interim calculations to one decimal and final answers to the nearest whole dollar. 40 units@ $116 60 units@$128 30 units $136 70 units@$138 Cost of Merchandise Inventory and Cost of Merchandise Sold Inventory Method Herchandise Inventory Merchandise Sold Weighted average cost

Explanation / Answer

Merchandise Inventory and Cost of goods sold are as calculated below:

FIFO Date Explanation Units Unit Cost Cost Jan-01 Opening Inventory 40 116.00 4,640 Mar-10 Purchased Inventory 60 128.00 7,680 Aug-30 Purchased Inventory 30 136.00 4,080 Dec-12 Purchased Inventory 70 138.00 9,660 Cost of goods available for sale 200 26,060 Cost of goods sold Jan-01 Opening Inventory 40 116.00 4,640 Mar-10 Purchased Inventory 60 128.00 7,680 Aug-30 Purchased Inventory 20 136.00 2,720 120 15,040 Dec-31 Ending Inventory Aug-30 Purchased Inventory 10 136.00 1,360 Dec-12 Purchased Inventory 70 138.00 9,660 80 11,020 LIFO Date Explanation Units Unit Cost Cost Jan-01 Opening Inventory 40 116.00 4,640 Mar-10 Purchased Inventory 60 128.00 7,680 Aug-30 Purchased Inventory 30 136.00 4,080 Dec-12 Purchased Inventory 70 138.00 9,660 Cost of goods available for sale 200 26,060 Cost of goods sold Dec-12 Purchased Inventory 70 138.00 9,660 Aug-30 Purchased Inventory 30 136.00 4,080 Mar-10 Purchased Inventory 20 128.00 2,560 120 16,300 Dec-31 Ending Inventory Mar-10 Purchased Inventory 40 128.00 5,120 Jan-01 Opening Inventory 40 116.00 4,640 80 9,760 Weighted Date Explanation Units Unit Cost Cost Jan-01 Opening Inventory 40 116.00 4,640 Mar-10 Purchased Inventory 60 128.00 7,680 Aug-30 Purchased Inventory 30 136.00 4,080 Dec-12 Purchased Inventory 70 138.00 9,660 Cost of goods available for sale 200 130.30 26,060 Cost of goods sold 120 130.30 15,636 Dec-31 Ending Inventory 80 130.30 10,424

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