Question

Tamarisk Company sells two types of pumps. One is large and is for commercial use. The other is smaller and is used in residential swimming pools. The following inventory data is available for the month of March. Price per Unit Units Total 440 $ 300 $ 132,000 1,100 880 660 $ $ $ 450 475 500 $ 495,000 $ 418,000 $ 330,000 1,100 880 1,100 $ 540 $ 570 $ 594,000 $ 501,600 Residential Pumps Inventory at Feb. 28: Purchases: March 10 March 20 March 30 Sales: March 15 March 25 Inventory at March 31: Commercial Pumps Inventory at Feb. 28: Purchases: March 3 March 12 March 21 Sales: March 18 March 29 Inventory at March 31: 1,320 $ 800 $ 1,056,000 1,320 660 1,100 $ 900 $ 950 $1,000 $1,188,000 $ 627,000 $1,100,000 1,980 1,320 1,100 $ 1,080 $ 1,140 $ 2,138,400 $ 1,504,800

Answer 1

RESIDENTIAL PUMPS
FIFO	Cost of goods available for sale			Cost of goods sold			Ending inventory
	No. of units	Cost per unit	Cost of goods available for sale	No. of units	Cost per unit	Cost of goods sold	No. of units in ending inventory	Cost per unit	Ending inventory
Beginning inventory	440	$            300.0	$                     132,000				440	$         300.00	$                132,000
Purchases
Mar-10	1100	$            450.0	$                     495,000				1100	$         450.00	$                495,000
Sales
Mar-15				440	$         300.00	$                   132,000
Mar-15				660	$         450.00	$                   297,000	440	$         450.00	$                198,000
Purchases
Mar-20	880	$            475.0	$                     418,000				440	$         450.00	$                198,000
							880	$         475.00	$                418,000
Sales
Mar-25				440	$         450.00	$                   198,000
Mar-25				440	$         475.00	$                   209,000	440	$         475.00	$                209,000
Purchases
Mar-30	660	$            500.0	$                     330,000				440	$         475.00	$                209,000
							660	$            500.0	$                330,000
Total	3080		$                  1,375,000	1980		$                   836,000	1100		$                539,000
Cost of goods sold			$                     836,000
Ending inventory			$                     539,000

COMMERCIAL PUMPS
FIFO	Cost of goods available for sale			Cost of goods sold			Ending inventory
	No. of units	Cost per unit	Cost of goods available for sale	No. of units	Cost per unit	Cost of goods sold	No. of units in ending inventory	Cost per unit	Ending inventory
Beginning inventory	1320	$            800.0	$                  1,056,000				1320	$            800.0	$            1,056,000
Purchases
Mar-03	1320	$            900.0	$                  1,188,000				1320	$            800.0	$            1,056,000
Mar-12	660	$            950.0	$                     627,000				1320	$            900.0	$            1,188,000
							660	$            950.0	$                627,000
Sales
Mar-18				1320	$         800.00	$               1,056,000
Mar-18				660	$         900.00	$                   594,000
							660	$            900.0	$                594,000
							660	$            950.0	$                627,000
Purchases
Mar-21	1100	$        1,000.0	$                  1,100,000				660	$            900.0	$                594,000
							660	$            950.0	$                627,000
							1100	$        1,000.0	$            1,100,000
Sales
Mar-29				660	$            900.0	$                   594,000
				660	$            950.0	$                   627,000	1100	$        1,000.0	$            1,100,000
Total	4400		$                  3,971,000	3300		$               2,871,000	1100		$            1,100,000
Cost of goods sold			$                  2,871,000
Ending inventory			$                  1,100,000

total
Cost of goods sold	$               3,707,000
Ending inventory	$               1,639,000

VALUE OF OPENING INVENTORY (BASE INDEX)
RESIDENTIAL PUMPS	1100*300	$      330,000.00
COMMERCIAL PUMPS	1100*800	$      880,000.00
		$ 1,210,000.00
VALUE OF CLOSING INVENTORY
RESIDENTIAL PUMPS	660*500	$      330,000.00
	440*475	$      209,000.00
COMMERCIAL PUMPS	1100*1000	$ 1,100,000.00
		$ 1,639,000.00
PRICE INDEX	VALUE OF CLOSING INVENTORY AT CURRENT COST/VALUE OF ENDING INVENTORY AT BASE YEAR COST	135.455%
OPENING INVENTORY VALUE		$ 1,210,000.00
CLOSING INVENTORY VALUE		$ 1,639,000.00
ENDING VALUE AS PER INFLATION		$ 1,210,000.00
= 1,369,000/135*100
= 28.25 - 25.00		$                       -
GROSS UP VALUE		-
3.25 * 130.98/100
dollar value lifo method
OPENING INVENTORY VALUE		$ 1,210,000.00
GROSS UP VALUE		$                       -
dollar value lifo method		$ 1,210,000.00