Question

In its first month of operations, Sandhill Co. made three purchases of merchandise in the following sequence: 200 units at $15; 250 units at $14; and 300 units at $13. There are 490 units on hand at the end of the period. Sandhill uses a periodic inventory system.

Calculate the cost of the ending inventory and cost of goods sold under FIFO. FIFO Ending inventory " Cost of goods sold "

Answer 1

Answer, Units avoutable for sale 200 units + 20 + 300 750 units Units in Ending inventong = 490 units Units sold 750-490 260 units Perlodic - FIFO melhodl_ :- Encing inventory = 800 x $13) +(190 x $14) $6560 cost of goods solde (200x $15) + (box $LU) $ 38 40 periodic- Pweighled avage melupal- Total COSE Units available for sale Average cost per urut = = (200x $15)+(250 x $14) + (300x $13) 450 units = $13.87 per unit .: Ending inventory = 490 units X $ 13.87 $65196 2. cost of goody solde 260 units X $ 13.87 $3606/