Question

Exercise Question Sport Box sells a wide variety of sporting equipment. The following is information on the purchases and sales of their top selling hockey stick. The hockey stick sells for $130. Units Description Beginning Inventory Unit Cost $30 Mar. 1 Mar. 3 Purchase $35 $40 Mar. 6 Purchase Salo Mar. 17 Mar. 23 Mar. 31 Purchase Solo Required: Calculate the cost of goods sold and ending inventory under the perpetual inventory system using 1. FIFO 2. Moving weighted average (MWA), Round all unit costs to two decimal places and round all other numbers to the nearest dollar

Answer 1

	FIFO method
		Purchase(receipt)				Sale				Balance
	Date	Qty.	Rate	Amount		Qty.	Rate	Amount(Rs.)		Qty.	Rate	Amount
Beg. Bal.	01-Mar	5	30	$150						5	30	$150
	03-Mar	50	35	$1,750						5	30	$150
										50	35	$1,750
	06-Mar	100	40	$4,000						5	30	$150
										50	35	$1,750
										100	40	$4,000
	17-Mar					5	30	$150
						40	35	$1,400		10	35	$350
										100	40	$4,000
	23-Mar	30	40	$1,200						10	35	$350
										100	40	$4,000
										30	40	$1,200
	31-Mar					10	35	$350
						100	40	$4,000
						10	40	$400		20	40	$800
		185		$7,100		Cost of goods sold		$6,300		Ending inventory		$800
	Moving average method
	Total cost of purchase and beginning inventory				=	$7,100
	Total units available for sale				=	185
	Average price					$38.38
		FIFO	Moving average method
	Ending inventory	$800	$768
			(38.38*20)
	Cost of goods sold	$6,300	$6,333
			(165*38.38)

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