You are provided with the following information for Barton Inc. Barton Inc. uses

Question

You are provided with the following information for Barton Inc. Barton Inc. uses the periodic method of accounting for its inventory transactions. March 1 Beginning inventory 1,940 liters at a cost of 62c per liter. March 3 Purchased 2,460 liters at a cost of 68t per liter. March 5 Sold 2,275 liters for $1.12 per liter. March 10 Purchased 3,880 liters at a cost of 754 per liter. March 20 Purchased 2,540 liters at a cost of 84 per liter. March 30 Sold 5,205 liters for $1.33 per liter. (al) Your answer is partially correct. Try again. Calculate the value of ending inventory that would be reported on the balance sheet, under each of the ollowing cost flow methods. (Round answers to 0 decimal places, e.g. 1250.) (1) Specific identification method assuming: (i) The March 5 sale consisted of 1,000 liters from the March 1 beginning inventory and 1,275 liters from the March 3 purchase; and (ii) The March 30 sale consisted of the following number of units sold from beginning inventory and each purchase: 495 liters from March 1; 600 liters from March 3; 2,985 liters from March 10; and 1,125 liters from March 20. (2) FIFO (3) LIFO

Explanation / Answer

BARTON INC. Ending Inventory Units available for sales=(1940+2460+3880+2540) 10820 Sales=(2275+5205) 7480 Units remaining in Ending Inventory 3340 Specific Identification Method (A) (B) (C ) D=(A)-(B)-(C ) (E ) (D)*(E ) Date Purchases March 5 Sales March 30 sales Inventory Rate Inventory Price 1-Mar 1940 1000 495 445 $       0.62 $              275.90 3-Mar 2460 1275 600 585 $       0.68 $              397.80 10-Mar 3880 2985 895 $       0.75 $              671.25 20-Mar 2540 1125 1415 $       0.84 $          1,188.60 10820 2275 5205 3340 $          2,533.55 Sales Cost of goods sold 5th March (1000*.62+1275*.68) $                         1,487.00 30th March (495*$.62+600*$.68+2985*$.75+1125*$.84) $                         3,898.65 Total Cost of goods sold $                         5,385.65 FIFO Inventory 2540 Litres @$.84 Per liter $                         2,133.60 (3340-2540) @.75 per liter $                             600.00 Inventory under FIFO Periodic Method $                         2,733.60 Cost of goods sold March 5th Sales March 30th Sales Total Cost of goods sold 1940 @$.62 $                         1,202.80 $                           1,202.80 335@$.68 $                             227.80 $                               227.80 2125@$.68 $                 1,445.00 $                           1,445.00 3080@$.75 $                 2,310.00 $                           2,310.00 Total $                           5,185.60 LIFO Inventory 1940@$.62 1202.8 (3340-1940)@$.68 952 Inventory under LIFO Periodic Method 2154.8 Cost of goods sold March 5th Sales March 30th Sales Total Cost of goods sold 2540@8.4 $                 2,133.60 $                           2,133.60 2665@$7.5 $                 1,998.75 $                           1,998.75 1215@$7.5 $                             720.80 $                               720.80 1060@6.8 $                                        -   Total $                           4,853.15 BARTON INC. Income Statement(Partial) For the year ended December 31,2015 Specific Identification FIFO LIFO Sales Revenue $                         9,470.65 $                 9,470.65 $                           9,470.65 Cost of goods sold $                         5,385.65 $                 5,185.60 $                           4,853.15 Gross Profit $                         4,085.00 $                 4,285.05 $                           4,617.50

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