Question

Exercise 6-07 a-c (Part Level Submission) Crane Company uses a periodic system reports the following for the month of June. Units Unit Cost Total Cost June 1 Inventory 250 $7 $ 1,750 12 Purchase 400 8 3,200 23 Purchase 350 9 3,150 30 Inventory 150

(a) Compute the cost of the ending inventory and the cost of goods sold under FIFO and LIFO. FIFO LIFO Cost of the ending inventory $ $ Cost of goods sold $ $ Click if you would like to Show Work for this question: Open Show Work LINK TO TEXT Attempts: 0 of 3 used SAVE FOR LATER SUBMIT ANSWER

(b) The parts of this question must be completed in order. This part will be available when you complete the part above.

(c) The parts of this question must be completed in order. This part will be available when you complete the part above.

Answer 1

	Inventory	units	per unit cost	total cost
1-Jun	Opening balance	250	$7	1750
12-Jun	Purchases	400	8	3200
23-Jun	Purchases	350	9	3150
30-Jun	Closing balance	150

No. of units sold during the month

	Units
Opening stock	250
Add: purchases	750	(400+350)
Less: closing stock	150
units sold during the month	850

FIFO- first in first out- inventory acquired first is sold first and so on.

	FIFO
Inventory taken from :	Units	Per unit	COGS $
opening balance	250	7	1750
June 12 purchases	400	8	3200
balance from June 23 purchases (850-400-250)	200	9	1800
Total	850		6750

therefore total COGS under FIFO method= $6,750

ending inventory
balance left from June 23 purchase	350-200
	150
per unit cost = $9
therefore value of ending inventory	150*9
	$1,350

LIFO- last in first out- inventory acquired last is sold first and so on.

Based on above explanation:

	LIFO
Inventory taken from :	Units	Per unit	COGS $
June 23 purchases	350	9	3150
June 12 purchases	400	8	3200
balance from opening stock(850-350-400)	100	7	700
Total	850		7050

therefore total COGS under LIFO method= $7,050

ending inventory
balance left from opening stock	250-100
	150
per unit cost = $7
therefore value of ending inventory	150*7
	$1,050