Question

Periodic Inventory Using FIFO, LIFO, and Weighted Average Cost Methods

The units of an item available for sale during the year were as follows:

Jan. 1	Inventory	19	units at $39	$741
July 7	Purchase	16	units at $42	672
Nov. 23	Purchase	6	units at $43	258
		41	units	$1,671

There are 12 units of the item in the physical inventory at December 31. The periodic inventory system is used. Determine the inventory cost using (a) the first-in, first-out (FIFO) method; (b) the last-in, first-out (LIFO) method; and (c) the weighted average cost method (round per unit cost to two decimal places and your final answer to the nearest whole dollar).

a.	First-in, first-out (FIFO)	$
b.	Last-in, first-out (LIFO)	$
c.	Weighted average cost	$

Answer 1

Answer:

Calculate ending inventory :

a) First in first out = (6*43+6*42) = $510

b) Last in first out = (19*39+7*42) = $1035

c) Weighted average = 1671/41 = 40.76*12 = $489.12

Answer 2

Where did the 7 come from?