Question

Could you show me how to do rhe steps for LIFO and FIFO please and show me where the numbers are coming from.

Jallualy out6.Goods purchased by the company shipped f.o.b. destination on December 29 that arrived on January 3. out Merchandise held on consignment for another company In Class Problem Chapter 9 Hondo Corporation uses a periodic inventory system. The following information related to its merchandise inventory during the month of October is available: Oct. 1 Inventory on hand-2,000 units; cost $5.00 each. 8 Purchased 10,000 units for $5.50 each. 14 Sold 8,000 units for $12.00 each. 18 Purchased 6,000 units for $6.10 each. 25 Sold 7,000 units for $11.00 each. 31 Inventory on hand-3,000 units.

Answer 1

Correct Answer:

	FIFO	LIFO
Cost of Goods Sold	$                  83,300.00	$                  86,100.00
Ending Inventory	$            18,300.00	$            15,500.00

Working:

Cost of Goods Available for sale
		Units	Cost per unit	value
Beginning Inventory		2000	$                       5.00	$                 10,000.00
Purchases		10000	$                       5.50	$                 55,000.00
Purchases		6000	$                       6.10	$                 36,600.00
Total		18000		$              101,600.00

	Periodic FIFO
A	Total Units Available for sale			18000		$ 101,600.00
	Units Sold			15000
	Ending Inventory Units			3000
	Valuation
	Cost of Goods Sold		2000		$                           5.00	$    10,000.00
			10000		$                           5.50	$    55,000.00
			3000		$                           6.10	$    18,300.00
B	Cost of Goods Sold		15000	units		$    83,300.00
A-B	Ending Inventory		3000	units		$    18,300.00

	Periodic LIFO
A	Total Units Available for sale			18000		$ 101,600.00
	Units Sold			15000
	Ending Inventory Units			3000
	Valuation
	Cost of Goods Sold		6000		$                           6.10	36,600.00
			9000		$                           5.50	49,500.00
B	Cost of Goods Sold		15000	units		$    86,100.00
A-B	Ending Inventory		3000	units		$    15,500.00

End of answer.

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