1.Determine the cost of goods sold and ending inventory using (1) FIFO and (2) a

Question

1.Determine the cost of goods sold and ending inventory using (1) FIFO and (2) average cost, assuming Mountain Country uses a perpetual inventory system. (Round FIFO answers to the nearest whole dollar, e.g. 5,275 and Average cost answers to 2 decimal places, e.g. 15.25.)

2.Determine the cost of goods sold and ending inventory using (1) FIFO and (2) average cost, assuming Mountain Country uses a periodic inventory system. (Round FIFO answers to the nearest whole dollar, e.g. 5,275 and Average cost answers to 2 decimal places, e.g. 15.25.)

Mountain Country, Inc. sells an Xpert skateboard that is popular with skateboard enthusiasts. The following information shows Mountain Country's purchases and sales of Xpert skateboards during February: Unit Sales Price Unit Units Cost 33 $300 23 305 Date Explanation Feb. 1 Beginning inventory 8 Purchases 15 Sales 19 Purchases 22 Sales 25 Purchases (37) $490 43 310 (46) 501 35 315 51

Explanation / Answer

1. FIFO (perpetual)

Cost of goods sold = $25285
Cost of ending inventory = $15985

Average cost (perpetual)

Cost of goods sold = $25324
Cost of ending inventory = $15946

2. FIFO (Periodic)

Cost of goods sold = $41270 - $15985 = $25285

Average cost (Periodic)

Cost of goods sold = $25564
Cost of ending inventory = $15706

Date Explanation Purchases Cost of goods sold Inventory Qty Rate Amt Qty Rate Amt Qty Rate Amt Feb 1 Beg. inventory 33 $300 $9900 Feb 8 Purchases 23 $305 $7015 33 300 9900 23 305 7015 Feb 15 Sales 33 300 9900 4 305 1220 19 305 5795 Feb 19 Purchases 43 310 13330 19 305 5795 43 310 13330 Feb 22 Sales 19 305 5795 27 310 8370 16 310 4960 Feb 25 Purchases 35 315 11025 16 310 4960 35 315 11025 $25285

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