Question

Hello,

Can you please help me with this problem and give an explanation for the correct answer? There are three tabs FIFO, LIFO and Average Cost. Thank you

Aug.1 Inventory on hand-3,900 units; cost $7.20 each. 8 Purchased 19,500 units for $7.40 each. 14 Sold 15,600 units for $13.90 each. 18 Purchased 11,700 units for $7.50 each. 25 Sold 14,600 units for $12.90 each. 28 Purchased 5,900 units for $5.80 each. 31 Inventory on hand-10,800 units. Required: Using calculations based on a periodic inventory system, determine the inventory balance Altira would report in its August 31, 2021, balance sheet and the cost of goods sold it would report in its August 2021 income statement using each of the following cost flow methods. Complete this question by entering your answers in the tabs below. FIFO LIFO Average Cost Determine the inventory balance Altira would report in its August 31, 2021, balance sheet and the cost of goods sold it would report in its August 2021 income statement using the FIFO method. (Round "Cost per Unit" to 2 decimal places.) Cost of Goods Available for Sale Cost of Goods Sold - Periodic FIFO . Ending Inventory - Periodic FIFO FIFO # of units # of units sold Cost per unit $ 7.20 Cost of Goods Available for Sale $ 28,080 Cost per unit $ 7.20 # of units in ending inventory Cost of Goods Sold $ 28,080 Cost per unit $ 7.20 Ending Inventory $ 0 3,900 3,900 5 0 Beginning Inventory Purchases: August 8 August 18 August 28 Total $ 7.40 $ 7.50 $ 5.80 $ 7. 40 $ 7.50 19,500 11,700 5,900 41,000 7,720 58,500 144,300 87,750 34,220 294,350 7,800 7,800 3,900 23,400 $ 7. 40 $ 7.50 $ 5.80 $ 144,300 0 FIFO LIFO

Answer 1

Average Cost Per Unit= 294350/41000= 7.18

Periodic: FIFO Cost of Goods Sold Inventory Balance cost of Goods Available for sales cost of Goods Available for# of Units Cost Per Cost of Ending Inventory # of Cost Per Unit # of Units Cost Per Unit sales sold Unit Goods Sold Units Beginning inventory| Purchases Aug-08 Aug-18 Aug-28 7.20 3900 28080 3900 7.20 28080 0 7.20 0 19500 7.40 144300 19500 7.40 144300 0 7.40 0 36750 7.50 87750 7.50 51000 7.50 11700 6800 4900 5900 5.80 5.80 5900 5.80 34220 0 0 34220 Totals 41000 294350 30200 223380 10800 70970 Periodic: LIFO Inventory Balance cost of Goods Available for sales Cost of Goods Sold cost of Goods Available for#of Units Cost Per Cost of Unit sold # of Goods Sold Units Cost Per Ending Inventory Cost Per Unit sales #of Units Unit Beginning inventory Purchases Aug-08 Aug-18 Aug-28 3900 7.20 3900 7.20 28080 0 7.20 28080 19500 7,40 7.40 51060 144300 12600 7.40 93240 6900 7.50 87750 7.50 87750 7.50 11700 11700 0 0 5900 5.80 5900 5.80 5.80 34220 34220 0 0 Totals 294350 215210 10800 41000 30200 79140 O

Periodic: average Cost Inventory Balance Average Cost of Goods Sold cost of Goods Available for sales Average of Units Cost per Cost of cost of Goods Average Cost Available for sales Ending #of Goods SoldUnits Cost per of Units unit sold per unit unit Inventory Beginning inventory Purchases 3900 7.20 28080 19500 Aug-08 7.40 144300 Aug-18 Aug-28 7.50 87750 11700 5900 5.80 34220 Totals 30200 294350 41000 10800 77544 7.18 7.18 216836 7.18