Penn Company uses a periodic inventory system. At the end of the annual accounti
ID: 2489662 • Letter: P
Question
Penn Company uses a periodic inventory system. At the end of the annual accounting period, December 31, 2015, the accounting records provided the following information for product 1: Units Unit Cost Inventory, December 31, 2014 1,910 $ 6 For the year 2015: Purchase, March 21 5,040 8 Purchase, August 1 2,950 9 Inventory, December 31, 2015 4,090 Required: Compute ending inventory and cost of goods sold under FIFO, LIFO, and average cost inventory costing methods. (Round "Average cost per unit" to 2 decimal places and final answers to nearest whole dollar amount.) HintsReferenceseBook & Resources Hint #1
Explanation / Answer
Beginning 1910 *6 = 11,460
Purchase 5040* 8 = 40,320
Purchase 2950*9 = 26,550
Total 9,900 =78,330
Average cost per unit = 78,330/9900
=7.912121212
Goods sold = total – ending inventory = 9900 – 4090 = 5,810
Cost of goods sold = 5180*7.912121212 = 45,969
Ending inventory = 32,361
FIFO
Cost of goods sold
(1,910*6 + 3900*8 ) = 42,660
Ending
(1140*8 + 2,550) = 35,670
LIFO
Cost of goods sold (2950*9 + 2860*8) = 49,430
Ending (1910*6 + 2180*8) = 28,900
Beginning 1910 *6 = 11,460
Purchase 5040* 8 = 40,320
Purchase 2950*9 = 26,550
Total 9,900 =78,330
Average cost per unit = 78,330/9900
=7.912121212
Goods sold = total – ending inventory = 9900 – 4090 = 5,810
Cost of goods sold = 5180*7.912121212 = 45,969
Ending inventory = 32,361
FIFO
Cost of goods sold
(1,910*6 + 3900*8 ) = 42,660
Ending
(1140*8 + 2,550) = 35,670
LIFO
Cost of goods sold (2950*9 + 2860*8) = 49,430
Ending (1910*6 + 2180*8) = 28,900
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