The beginning inventory was 300 units at a cost of $10 per unit. Goods available
ID: 2449698 • Letter: T
Question
The beginning inventory was 300 units at a cost of $10 per unit. Goods available for sale during the year were 1.300 units at a total cost of $14,400 In May, 600 units were purchased an a total cost of $6,600. The only other purchase transaction occurred during October. Ending inventory was 550 units. Required: Calculate the number of units purchased in October and the cost per unit purchased in October. Assume the periodic inventory system is used Calculate cost of goods sold and ending inventory using FIFO method. Assume the period inventory system is used Calculate cost of goods sold and ending inventory using LIFO methodExplanation / Answer
a) Number of units purcahsed in month of October & cost per unit of the purchase.
Hence uumber of units purchase in Oct was 400 units & cost per unit for that was $12.
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Part B: To calculate cost of inventory udner FUFO mentos & LIFO is not given hence I assumed that goods sold as below-
In June 2015, 350 units sold for total value of $7,000
In Nov. 2015 600 units sold for total value of $12,600
On the basis of above sale assumption remaining question is solved as below.
(Q.2b) Cost of good sold & ending inventory under FIFO method.
550
(Q.2c) Cost of good sold & ending inventory under LIFO method.
6600
June (Sale of units)
9600
350
3850
250
300
11
10
2750
3000
November (Sale of units)
600
7000
50
300
11
10
550
3000
(400x12) + (200 x 11)
SN Good available for sale Units Cost per unit ($) Total cost of purchase i Total units availble for sale 1300 14,400/1300 = 11.08 14,400 ii Begining inventory 300 10 (given) 3000 iii Purchases in May 600 6600/600 = 11 6600 iv total of item ii & iii 900 9600 v Units purchased in October 1300-900=400 4800/400 = 12 14400 - 9600 =4800Related Questions
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