QUESTION4 INVENTORY VALUATION METHODS The beginning inventory, purchases and sal

Question

QUESTION4 INVENTORY VALUATION METHODS The beginning inventory, purchases and sales of Harper's Delight Ltd during the month of January 2017 were as follows: Jan 6Beginning Inventory Jan 14 Purchased 350 Unitsa $6.50$,15 a S6.50$9,815 a $7.50 a s8.00 @ $9.50 Jan 20 Purchased 280 Units 9,34 an Purchased 160 units Totals Harper's Delight Ltd, sold 940 units during the month of January for $35.00 per unit Using the Periodie inventory system Part A Calculate the physical number of units remaining in ending inventory on January 31" Units in Ending Inventory Part B Calculate the Svalue of Cost of Goods Sold and Ending Inventory under the FIFO. Cost of Goods Sold Ending Inventory

Explanation / Answer

Solution:-

Part A. Units in ending inventory:-

100 units.

Explanation:-

Ending inventory in units = beginning inventory + total purchase - units sold

= 350 + (250 + 280 + 160) - 940 = 100 units

Part B.

Explanation:-

Ending inventory under FIFO method:- 100 * 9.50 = $ 950

Cost of goods sold under FIFO method:- (350 * 6.50) + (250 * 7.50) + (280 * 8.00) + (60 * 9.50)

= $ 6,960.

Please Rate or comment if you have any doubt regarding this solution.

Particulars Amount Ending inventory $ 950 Cost of goods sold $ 6,960

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