Question

Nittany 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 2, eee $5 Inventory, December 31, prior year For the current year: Purchase, March 21 Purchase, August 1 Inventory, December 31, current year 5,000 3. eee 4.999 Required: Compute ending Inventory and cost of goods sold for the current year under FIFO, LIFO, and average cost Inventory costing methods. FIFO LIFO Average Cost Ending inventory Cost of goods sold

Answer 1

cap Curretation gode sold Tro, wro of for and sending hentory and costs of the current your ander even cont inventory costing Erro method! sit is in the 1 Erro a method calculation glad well of for for Cost "rict-In, first-ul cat flow asumption of goode solda " The fifo method assured the have been older sold porducte fired Cetween Colculation the Year of number of write sold during - 200 units Given opening Total unito Inventory purchased during (ti march 21 + Sow unit (4) August a - + 200 veita - yoou unit (-) closing No. of unit during Inventory sols the Year Gooounite

Colculation of goods sold to number under firo producte in sold first. Ending inventory and code of undo tiro melhor of unite gold bord unike method as it assume that oldest a company's inventor! dove been unite 35 * 2000 from opening inventory Bon which 4000 Remaining inventory purchase, march from which 2 ). (ie 6000 - 2000 ) cost of goode sold = (2000x85 turbo x$ 6) - 0005 24000 $7 - 34000 Ft Totalcos (4) CAXB 1000 68 Goous Ending Inventory Remaing babolnas Belance Poore moach 21 purchase (5000-1000) Balona from August 2 purchase 240005 3000 UDD - 3oooos 1000 unite it costs = 30000$ Endins 3. Inventory Feed

Colculation under LIFO method! under the LIFO stands for and under the LiFo methad had are al First the oldest chils are inventory wat in he unite perne have still in The number of units colde 6000 units knite Cost of 3000 86 ceiver hat archase during the year on Augen 21 Cier 2000 units futhi cetilized reat phatice 3000 6$ from moach 21 purchares (6000 - 3000 units Total cost of good sold under Go LIFO method 2000 x $8 +300 x $6 - 24000 + $18000 = $4200011 Ending inventory under Lito method: Remaing bolna hits are from noch 21 proches a 200 units (50 3000) opening inventory a 2000 unit

Cost of Ending Inventory under LIFO nelhal balna Perraig units cool para Forn march 21 percher 2000 from opening inventors 2000 un cost of ending inventor 2000x86 of 2000x 35 $12000 + $10000 - $22.000 4 = Average cost method in when using the weighted average melhod, divide the cost of good available for sale bi rember of onits avaibbb for ese, which fielt the weighted. overg cool per unit. In this collerbalea cost of good availt Sun & hinc inventors and net purchake. cocubition of cost of goods availahs for sale units und Perio available for sale is the Sum of begining coridad a 200U invertory Opening Tool cost Ax $10000 $ 30000 $ 200 sou Pernchar moch 21 3,000 perschare Aug 21 $ Gundo units 10000

average cost per unit Coleublion of content weighted cast of goodle number of available for sale unite available for sole & GOOO = $64 perunt (oooo s u caste of good estas per weighted average me that unite sold x cost per unit = Noumber of Gooo X 614a 384008 cost of ending inventory a 4000X $6.42 25 Goos FIFO LIFO Averge Cot 3000 $ 22000$ 2560o Ending Cost inventory of good cond 34000 $. u2000's 38400 conde all the Mote ! cenite of ending a sinventory methodo - 4000 units unite of cast of goods sold methods 1000 unite undee all flo goods sold u method. Cest out