Calculate ending inventory and cost of goods sold under FIFO, LIFO and Average C

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Calculate ending inventory and cost of goods sold under FIFO, LIFO and Average Cost LO7-2

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E7-5 Calculating Ending Inventory and Cost of Goods Sold Under FIFO, LIFO, and Average Cost LO7-2 Penn Company uses a periodic inventory system. At the end of the annual accounting period, December 31 of the current year, the accounting records provided the following information for product 1: Units Unit Cost 1,920$6 Inventory, December 31, prior year For the current year: Purchase, March 21 Purchase, August 1 5,160 Inventoryg December 31, current year2,040 Required Compute ending inventory and cost of goods sold for the current year under FIFO, LIFO, and average cost inventory costing methods. (Round "Average cost per unit to 2 decimal places and final answers to nearest whole dollar amount.) FIFO LIFO Average Cost Ending inventory31,840 Cost of goods sold$ 46.700

Explanation / Answer

Explanation Units Unit Cost $ Inventory At dec 31 1920 6 11520 For current year 21-Mar 5160 8 41280 01-Aug 2860 9 25740 Total available for sale 9940 78540 FIFO Ending Inventory 01-Aug 2860 9 25740 21-Mar 1180 8 9440 TOTAL 4040 35180 Cost of goods sold Inventory At dec 31 1920 6 11520 21-Mar 3980 8 31840 TOTAL 5900 43360 LIFO Ending Inventory Inventory At dec 31 1920 6 11520 21-Mar 2120 8 16960 TOTAL 4040 28480 Cost of goods sold 01-Aug 2860 9 25740 21-Mar 3040 8 24320 5900 50060 AVERAGE COST Cost of Goods Avail for Sale/Number of Goods Avail for Sale 78540/9940 7.90 Ending Inventory 4040*7.9 31916 Cost of goods sold 5900*7.9 46610 FIFO LIFO Average Cost Ending inventory 35180 28480 31916 COGS 43360 50060 46610

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