Question

Problem 6-06A al-a2 (Part Level Submission) You are provided with the following information for Lily Inc. Lily Inc. uses the periodic method of accounting for its inventory transactions. March 1 Beginning inventory 2,200 liters at a cost of 80¢ per liter. March 3 Purchased 2,500 liters at a cost of 84¢ per liter. March 5 Sold 2,300 liters for $1.05 per liter. March 10 Purchased 4,000 liters at a cost of 91¢ per liter. March 20 Purchased 2,500 liters at a cost of 99¢ per liter. March 30 Sold 5,000 liters for $1.25 per liter. (al) Calculate the value of ending inventory that would be reported on the balance sheet, under each of the following cost flow assumptions. (Round answers to 2 decimal places, e.g. 125.50.) (1) Specific identification method assuming: (1) The March 5 sale consisted of 1,000 liters from the March 1 beginning inventory and 1,300 liters from the March 3 purchase; and (i) The March 30 sale consisted of the following number of units sold from beginning inventory and each purchase: 450 liters from March 1; 550 liters from March 3; 2,900 liters from March 10; 1,100 liters from March 20. (2) FIFO (3) LIFO Ending inventory Specific identification FIFO LIFO

Answer 1

Ans
1	Specific Identification
	Date	Op. Inventory	Op. Inventory cost	Total Cost	Purchase Qty	Purchase Price	Total Cost
		(in liters)	(in cent)	(litter*cent)	(in liters)	(in cent)	(litter*cent)
	1-Mar	2200	80
	March 5 sales	-1000	105
	March 30 sales	-450	125
	Balance from Op .inventory	750	80	60000
	3-Mar				2500	84
	March 5 sales				-1300	105
	March 30 sales				-550	125
	Balance from 3 march purchase				650	84	54600
	10-Mar				4000	91
	March 30 sales				-2900	125
	Balance from 10 march purchase				1100	91	100100
	20-Mar				2500	99
	March 30 sales				-1100	125
	Balance from 20 march purchase				1400	99	138600
	Total			60000			293300
	Specific Identification
	Ending Inventory 3900 litters	$                  3,533.00
	(60000+54600+100100+138600)
2	FIFO
	Date	Op. Inventory	Op. Inventory cost	Purchase Qty	Purchase Price	Total Cost
		(sales Qty)		(sales Qty)
		(in liters)	(in cent)	(in liters)	(in cent)	(litter*cent)
	1-Mar	2200	80
	March 5 sales	-2200
	Balance from Op .inventory	0
	3-Mar			2500	84
	March 5 sales			-100
	March 30 sales			-2400
	Balance from 3 march purchase			0
	10-Mar			4000	91
	March 30 sales			-2600
	Balance from 10 march purchase			1400	91	127400
	20-Mar			2500	99	247500
	Total			3900		374900
	FIFO
	Ending Inventory 3900 litters	$                  3,749.00
3	LIFO
	Date	Op. Inventory	Op. Inventory cost	Purchase Qty	Purchase Price	Total Cost
		(sales Qty)		(sales Qty)
		(in liters)	(in cent)	(in liters)	(in cent)	(litter*cent)
	1-Mar	2200	80			176000
	3-Mar			2500	84
	March 30 sales			-800
	Balance from 3 march purchase			1700	84	142800
	10-Mar			4000	91
	March 30 sales			-4000
	Balance from 10 march purchase			0
	20-Mar			2500	99
	March 5 sales			(2,300)
	March 30 sales			-200
	Balance from 20 march purchase			0
	Total					318800
	LIFO
	Ending Inventory 3900 litters	$                  3,188.00