Electronic Center began December with 70 units of merchandise inventory that cos

Question

Electronic Center began December with 70 units of merchandise inventory that cost $ 74 each. During December, the store made the following purchases: LOADING... (Click the icon to view the purchases.) Right Now uses the periodic inventory system, and the physical count at December 31 indicates that 80 units of merchandise inventory are on hand. Read the requirements LOADING.... Requirement 1. Determine the ending merchandise inventory and cost of goods sold amounts for the December financial statements using the FIFO, LIFO, and weighted-average inventory costing methods.

Data Table

Dec.3 20 units @$76each

12 30 units @$78each

18 40units @$94each

Explanation / Answer

FIFO

Beginning merchandise inventory (70 x $74) =$5180

Net cost of purchase (20 x 76 = 1520) +(30 x 78 = 2340) + (40 x 94 = 3760) = 7620

Cost of goods available for sale = 12800

Less: Ending merchandise inventory ((10 x 76 = 760) +(30 x 78 = 2340) + (40 x 94 = 3760) = 6860

Cost of goods sold = 5940

LIFO

Beginning merchandise inventory (70 x $74) =$5180

Net cost of purchase (20 x 76 = 1520) +(30 x 78 = 2340) + (40 x 94 = 3760) = 7620

Cost of goods available for sale = 12800

Less: Ending merchandise inventory ((70 x 74 = 5180) + (10 x 76 = 760)) = 5940

Cost of goods sold = 6860

weighted-average

Beginning merchandise inventory (70 x $74) =$5180

Net cost of purchase (20 x 76 = 1520) +(30 x 78 = 2340) + (40 x 94 = 3760) = 7620

Cost of goods available for sale = 12800

Weighted average cost = 12800 / 160 = 80 per unit

Less: Ending merchandise inventory (80 units x $80 )= 6400

Cost of goods sold = 80 units * $ 80 = 6400

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