Question

Coronado Company sells two types of pumps. One is large and is for commercial use. The other is smaller and is used in residential swimming pools. The following inventory data is available for the month of March.

			Units		Price per Unit					Total
Residential Pumps
	Inventory at Feb. 28:		360			$	300			$	108,000
Purchases:
	March 10		900			$	450			$	405,000
	March 20		720			$	475			$	342,000
	March 30		540			$	500			$	270,000
Sales:
	March 15		900			$	540			$	486,000
	March 25		720			$	570			$	410,400
	Inventory at March 31:		900
Commercial Pumps
	Inventory at Feb. 28:		1,080			$	800			$	864,000
Purchases:
	March 3		1,080			$	900			$	972,000
	March 12		540			$	950			$	513,000
	March 21		900			$	1,000			$	900,000
Sales:
	March 18		1,620			$	1,080			$	1,749,600
	March 29		1,080			$	1,140			$	1,231,200
	Inventory at March 31:		900

Assume Coronado uses dollar-value LIFO and one pool, consisting of the combination of residential and commercial pumps. Determine the cost of inventory on hand at March 31 and the cost of goods sold for March. Assume Coronado’s initial adoption of LIFO is on March 1. Use the double-extension method to determine the appropriate price indices. (Hint: The price index for February 28/March 1 should be 1.00.) (Round Price Index to 3 decimal places e.g. 1.522 and other answers to 0 decimal places, e.g. 5,275.)

Cost of inventory		? $
Cost of goods sold		? $
Price index		?

Answer 1

Ans Coronado. Company EN LIFO Method ( Residential Pumps Dale Panchones Sales Closing Balance Quenting and Total Qty Juni Torty Qty. hit rotary Febap 360 $300 $108,00 March 10,900 $450 4,05,000 - - 11360 $ 300 $1,08,00 900 $450 $ 405, no Manch15 10 inch 950 $450 405, w 360 $300 $ 108,000 Manor 20 7201 $475 |$342,000 11 360$ 300 $ 108, 720 $ 475 $ 3424000 Mar. 25 - 720 $475 $ 342,500 360 $ 380 $ 108,00 Mar 30 540 s sou k 270,000 360 $ 360 $108,600 540 $500 $ 270, m. Mon. . 900 $378,00 Toroy 2160 1 017,900 1620 $ 747,000 900 $ 378,000 Cost of 0, Inventory on hand of Manch 31 - 3 60 units @ $ 300 each $100,00 540 units @ $500 each - $ 270,000 Toray =$ 378,000 Cost of Goods sold 5 $405, 000 + $ 342,000 = $ 747,00 ie: Pening Inventory & Punchases i Closing Inventory = $ 108, +$ 1,017, 00 $378,00 $747,000 Price Index : Invento no at Feb. 28 $108,000 Inventony at Manch 31

т Toro Unity LIFO (commercial pump) MO Date Punchases Sales Closing Inventory Unit Total Qty. Cot Lost) und Feb, 28 1,080 $800 (4 864,003 Mari 3 10 80 $900 $ 9726001 - 76080 $80018 864,500 11,080$ 900$972,000 Mar, 12540 $950 $ 513,000 02-07 - 11080 $800 5 864,000 091 - Peal1080 of 900 $97290 540 $950 $513,00 Man, 18 P - 7540 $950 $513,600 0 2.02SPOT Vioso $ 900$ 972,000 1080 $ 800 $ 864, om Mar, 21950 $1,000 $950, 1080 $ 800 $ 864,6VD 900 slovol$ 900,00 Man, 30 - 900 $1000 $950,000 12001 letool | 180 $800 $144,000 900 $800/$720,00 Man 31 5 950 $800 $ 720.00 Torey 25 202,01 $2,385,00 27001 $2,529600 960 . 720,600 Cost of Inventory (Commercial Pump) as at 31st Marly 500Glett 900 units @ & 800 each $ 720,000 cost of Google sold = Opening Inventony & Purchases - Closing Inventory : $864,070 +$2,385,00 $ 720,000 30 D - $ 3529,00

calculation by considering the two types of prema al cost ok Inventory on hand at Manch 31 Residential Pump X03 $ 378,000954291 amb El Commercial pump = $ 720,000 OM P OTO rap SX2 X30 $ 1,098,00 coin (6) cost ok Goods Sold Pendent to 79 3:26 w Residential Pump • $ 747,000 Commercial Pump - $2,529,000 Torajz . MUCHOMAT - $ 3, 276, no

Price: Indee! 2 b anan! value of Inventory TE GRON i brod Feb 28/ Man. I Mar 31. Base pnice) (Market Price Residentin Pump 360x8300 = $ 108,900 900 & $5 to. Lo $ 513,00 Commercial pump 1080x$800 = $864,000 900x $ 11yo -$1,026,00 Total $ 972, o $1,539,000 Price Indexe Croidis Inventory Inventory Cost at Ceinnent Price Cost ata Base price 2 $ 1,539, oroba iyo $ 97.2,000 201583 Sharez amet lostoubizon 1920. Nx y metlobinamos IO 650- 20.30!