Question

6. Jones Company was formed on December 1, 2019. The following information is available from Jones's inventory record for Product X. Units Unit Cost January 1, 2020 (beginning inventory) 2,400 $18.00 Purchases: January 5, 2020 3,900 $20.00 January 25, 2020 3,600 $21.00 February 16, 2020 1,500 $22.00 March 15, 2020 2,700 $23.00 A physical inventory on March 31, 2020, shows 3,000 units on hand. Instructions Prepare schedules to compute the ending inventory at March 31, 2020, under each of the following inventory methods: (a) FIFO. (b) LIFO. (C) Weighted average.

Answer 1

		FIFO	LIFO	Weighted Avergae Cost
	The ending inventory	$       68,700	55,200	$           62,106

Calculation of Units available for sale and Units of Ending Inventory
	Units available for sale
	Beginning Inventory, January 1				2400
	Purchases
	Jan 5			3900
	Jan 25			3600
	Feb 16			1500
	Mar 15			2700	11700
	Units available for sale				14,100
Less:	Units of Ending Inventory				3,000
	Units sold				11,100
Schedule of Cost of Goods Available for Sale
		Cost of Goods Available for Sale
		Units	Cost per unit	Cost of Goods Available for Sale
	Beginning Inventory (a)	2400	$              18.00	$           43,200
Add:	Purchases
	Jan 5	3900	$              20.00	$           78,000
	Jan 25	3600	$              21.00	$           75,600
	Feb 16	1500	$              22.00	$           33,000
	Mar 15	2700	$              23.00	$           62,100
	Cost of Goods available for sale	14100		$         291,900

(a) Calculation of ending inventory and Cost of goods sold under FIFO - periodic system:-
	Periodic FIFO	Cost of Goods Available for Sale			Cost of Goods Sold - Periodic FIFO			Ending inventory - Periodic FIFO
		# of Units	Cost per Unit	Cost of Goods Available for Sale	# of Units sold	Cost per Unit	Cost of Goods Sold	# of Units in Ending inventory	Cost per Unit	Ending inventory
	Beginning Inventory	2,400	$              18.00	$           43,200	2,400	$18.00	$         43,200
	Purchases:
	Jan 5	3,900	$              20.00	$           78,000	3,900	$20.00	$         78,000
	Jan 25	3,600	$              21.00	$           75,600	3,600	$21.00	$         75,600
	Feb 16	1,500	$              22.00	$           33,000	1,200	$22.00	$         26,400	300	$22.00	$           6,600
	Mar 15	2,700	$              23.00	$           62,100				2,700	$23.00	$        62,100
	Total	14,100		$         291,900	11,100		$      223,200	3,000		68,700
(b) Calculation of ending inventory and Cost of goods sold under LIFO - periodic system:-
	LIFO- Periodic	Cost of Goods Available for Sale			Cost of Goods Sold - Periodic LIFO			Ending inventory - Periodic LIFO
		# of Units	Cost of Goods Available for Sale	Cost of Goods Available for Sale	# of Units sold	Cost per Unit	Cost of Goods Sold	# of Units in Ending inventory	Cost per Unit	Ending inventory
	Beginning Inventory	2,400	$              18.00	$           43,200				2,400	$           18.00	$        43,200
	Purchases:
	Mar.15	3,900	$              20.00	$           78,000	3,300	$20.00	$         66,000	600	$20.00	$        12,000
	July 20	3,600	$              21.00	$           75,600	3,600	$21.00	$         75,600
	Sept. 4	1,500	$              22.00	$           33,000	1,500	$22.00	$         33,000
	Dec. 2	2,700	$              23.00	$           62,100	2,700	$23.00	$         62,100
	Total	14,100		$         291,900	11,100		$      236,700	3,000		55,200
(c) Calculation of ending inventory and Cost of goods sold under Weighted Average Cost - Periodic system:-
	Periodic -Weighted Average Cost	Cost of Goods Available for Sale			Cost of Goods Sold - Average Cost			Ending inventory - Average Cost
		# of Units	Cost of Goods Available for Sale	Cost of Goods Available for Sale	# of Units sold	Average Cost per Unit	Cost of Goods Sold	# of Units in Ending inventory	Average Cost per Unit	Ending inventory
	Beginning Inventory	2,400	$              18.00	$           43,200
	Purchases:
	January 30	3,900	$              20.00	$           78,000
	January 30	3,600	$              21.00	$           75,600
	January 30	1,500	$              22.00	$           33,000
	May 1	2,700	$              23.00	$           62,100
	Total	14,100	$              20.70	$         291,900	11,100	$               20.70	$      229,794	3,000	$           20.70	62,106
	Weighted Average Cost per unit			=	$291,900
					14100

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