Question

Required information M7-20 to 22 (Supplement 7A) Calculating Cost of Goods Sold and Ending Inventory under Perpetual FIFO, LIFO, and Weighted Average Cost [LO 7-S1) In its first month of operations, Literacy for the Illiterate opened a new bookstore and bought merchandise in the following order: (1) 300 units at $4 on January 1, (2) 450 units at $7 on January 8, and (3) 950 units at $8 on January 29. Assuming 1,100 units are on hand at the end of the month. M7-22 (Supplement 7A) Calculating Cost of Goods Sold and Ending Inventory under Perpetual Weighted Average Cost [LO 7-S1] Calculate the cost of goods available for sale, cost of goods sold, and ending inventory under the weighted average cost flow assumptions. Assume perpetual inventory system and sold 600 units between January 9 and January 28. (Round your intermediate calculations to 2 decimal places.) Weighted Average Cost Goods Available for Sale Cost of Goods Sold Ending Inventory

Answer 1

Answer with working is given below

I have given answer under all 3 methods for conceptual understanding

FIFO LIFO Weighted Average Cost Goods Available for Sale Cost of Goods Sold Ending Inventory $11,950 $3,300 $8,650 $11,950 $3,750 $8,200 $11,950.00 $3,480.00 $8,470.00 FIFO method and Perpetual Inventory System Cost of Goods available for Sale Cost of Goods sold Ending inventory Cost of Goods # of Units Cost per unit available for # of Units Cost per Cost of # of Units Goods in ending Sold inventory Cost per unit Ending inventory unit sale $1,200 1-Jan Purchases 8-Jan Purchase 29-Jan Purchase Sales $3,150 $7,600 $1,200 $2,100 150 950 1,100 $7 $8 $1,050 $7,600 $8,650 31-Jan Closing inventory Total issue $3,300 $0 Opening stock Add: Purchase Less: Closing stock Cost of Goods sold $11,950 $11,950 $8,650 $3,300 LIFO method and Perpetual Inventory System Cost of Goods available for Sale Cost of Goods sold Ending inventory Cost per # of Units unit Cost of Goods available for # of Units Cost per unit sale Cost of #of Units Goods in ending Sold inventory Cost per unit Ending inventory $1,200 1-Jan Purchases 8-Jan Purchase 29-Jan Purchase Sales $3,150 $7,600 150 $4 $3,150 $600 150 950 1,100 $4 $8 $600 $7,600 $8,200 31-Jan Closing inventory Opening stock Add: Purchase $0 Total issue $3,750 $11,950 $11,950 $8,200 $3,750 Less: Closing stock Cost of Goods sold Weighted Average Cost method and Perpetual Inventory system Cost of Goods available for Sale Cost of Goods sold Ending inventory Cost of #of Units cost per Ending # of Units Cost per unit Cost of Goods available for #of Units sale unit Goods in ending Sold inventory unit inventory 1-Jan Purchases 8-Jan Purchase 300 450 750 950 $4.00 $7.00 $5.80 $8.00 $1,200.00 $3,150.00 $4,350.00 $7,600.00 29-Jan Purchase Sales 600 $5.80 $3,480.00 150 950 1,100 $5.80 $8.00 $7.70 $870.00 $7,600.00 $8,470.00 31-Jan Closing inventory Opening stock Add : Purchase Total issue $3,480.00 $0.00 $11,950.00 $11,950.00 $8,470.00 $3,480.00 Less: Closing stock Cost of Goods sold

FIFO LIFO Weighted Avarege Cost Goods Available for Sale Cost of Goods Sold $11,950 $3,300 $8,650 $11,950 $3,750 $8,200 $11,950.00 $3,480.00 $8,470.00 FIFO method and Perpetual Inventory System Cost of Goods available for Sale Cost of Goods sold Ending inventory Cost of Goods # of Units available for # of Units Cost per Cost of #of Units Goods in ending Sold inventory Cost per unit Ending inventory unit unit sale 1-Jan Purchases 8-Jan Purchase 29-Jan Purchase Sales $1,200 $3,150 $7,600 $1,200 $2,100 150 950 1,100 $7 $8 $1,050 $7,600 $8,650 31-Jan Closing inventory Total issue $3,300 $0 Opening stock Add: Purchase Less: Closing stock Cost of Goods sold $11,950 $11,950 $8,650 $3,300 LIFO method and Perpetual Inventory System Cost of Goods available for Sale Cost of Goods sold Ending inventory Cost per # of Units unit Cost of Goods available for # of Units Cost per unit sale Cost of # of Units Goods in ending Sold inventory Cost per unit Ending inventory 1-Jan Purchases 8-Jan Purchase 29-Jan Purchase Sales $1,200 $3,150 $7,600 150 $4 $3,150 $600 150 950 1,100 $4 $8 $600 $7,600 $8,200 31-Jan Closing inventory Opening stock Add: Purchase $0 Total issue $3,750 $11,950 $11,950 $8,200 $3,750 Less: Closing stock Cost of Goods sold Weighted Average Cost method and Perpetual Inventory system Cost of Goods available for Sale Cost of Goods sold Ending inventory # of Units Cost per unit Cost of Goods available for #of Units sale Cost of #of Units Goods in ending Sold inventory Cost per unit Ending inventory unit $4.00 1-Jan Purchases 8-Jan Purchase $7.00 300 450 750 950 $5.80 $8.00 $1,200.00 $3,150.00 $4,350.00 $7,600.00 29-Jan Purchase Sales 600 $5.80 $3,480.00 150 950 1,100 $5.80 $8.00 $7.70 $870.00 $7,600.00 $8,470.00 31-Jan Closing inventory Opening stock Add: Purchase Total issue $3,480.00 $0.00 $11,950.00 $11,950.00 $8,470.00 $3,480.00 Less: Closing stock Cost of Goods sold