Inventory Costing Methods-Periodic Method The Toon Company, which uses the perio

Question

Inventory Costing Methods-Periodic Method The Toon Company, which uses the periodic inventory system, has the following records: 100 Jan. 6650 July 15 550 Dec. 28 200 Units Unit Cost $49 42 38 36 Beginning Inventory Purchases: Ending inventory was 360 units. Compute the ending inventory and the cost of goods sold for the year using (a) first-in, first-out, (b) weighted-average cost and (C) last-in, first- Do not round until your final answers. Round your answers to the nearest dollar A. First-in, First-out: Ending Inventory Cost of goods sold B. Weighted Average: Ending Inventory Cost of goods sold C. Last-in, First-out Ending Inventory Cost of goods sold

Explanation / Answer

Ending inventory under LIFO method and FIFO method

particulars

                    under LIFO

Under FIFO

360 units

(100*49+260*42)= $15,820

(160*38+200*36)=$13,280

Ending inventory under weighted average method

particulars

units

rate

beginning

100

$49

4900

purchases j 6

650

$42

27300

Jul-15

550

$38

20900

Dec-28

200

$36

7200

total

1500

60300

per unit cost(60300/1500)

$40.2

Ending inventory(360*$40.2)

$14,472

Cost of goods sold

Under FIFO method:

    First in first out = beginning=100*49=$4900

                                         Jan6       =650*42=$27300

                                      July 15     = 390*38=$14820

Cost of goods sold under FIFO=(4900+27300+14820)=$47020

       under   LIFO    dec 28   = 200*36=$7200

                            july 15        =550*38=$20900  

                                jan 6         =390*42=$16380

cost of goods sold under LIFO =$44480

under weighted average method

        1500units-360units=1140 units sold

Cost per unit =$40.2

Cost of goods sold under this method=1140*40.2=$45828

FIFO method :      

         Ending inventory =$13,280

    Cost of goods sold   =$47,020

LIFO method:

   Ending inventory =$15,820

Cost of goods sold=$44,480

Weighted average method:

         Ending inventory =$14,472

    Cost of goods sold   =$45,828

Ending inventory under LIFO method and FIFO method

particulars

                    under LIFO

Under FIFO

360 units

(100*49+260*42)= $15,820

(160*38+200*36)=$13,280

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