Question

wew... - 11. BIUA . A. E Lloyd Co. is a specialty retailer that operates in several locations in western North Carolina, Lloyd sells bicycles and related equipment and supplies. Data related to purchases and sales of one of its top selling bicycle models for the years 2018 and 2019 are shown below: Description Units Date O1/01/18 Cost Per Unit $349 01/26/18 03/09/18 05/14/18 07/02/18 Purchase Purchase Purchase Purchase 18 39 33 $355 $372 $387 $403 2018 Sales $412 01/22/19 03/15/19 05/19/19 07/01/19 Purchase Purchase Purchase Purchase 21 32 31 38 5 457 2019 Sales 128 Lloyd uses a periodic inventory system to account for its inventory transactions. The company prepares financial statements just once a year, at its December 31 year-end. None of the company's inventory was stolen or damaged during these two years. - Instructions - Address the following matters related to Lloyd Co.'s accounting for, and reporting of its Inventory activities during 2018 and 2019: (a) Compute the company's inventory at December 31, 2018 and its cost of goods sold for 2018 under each of the following cost flow methods: FIFO method

Answer 1

ANS- @- Inventory as on 31st Dec 2018 23. Pochane- 11/18 - 23 1/26/18- 18 3/9/18 - 39 5/14 / 18 - 33 72/18 - 48 Sale in 2018 109 52 unit - Cost of Goods Sald under 6IFO methool- Under Elfo method a - Total Sale unit - log So, 1st 23 un't Cast = 23x$349 = 8027 next 18 Unit Cost = 188$355 = 639 0 hent 39 unit Gsto = 39*$372 = 14508 neut 29 unit Gs+ : 29** 387 -11223 Cost of Goods Sold undby Elfo = $40148

I 2 LIFO Method - (we assume them all sale are made at the end of the team because of Date of Sale not given) ② Cast of Sale Goods ist ua unit - 48x $403 - 19394 hout 33 unit 33x $387 - 12711 mont 28 units : 28%$ 372 -- 10416 Cost of 109 unit Sale io de 10 $42531 Aug. Cast method Total Poschase Cast in 2018 - 23 x 349 + 18X355 + 39% 372 + 338387 + yox 463 = 0027 + 6390 + 14508+ 72771 + 19344 61040 No of un't pichase - 23 +18 +39 +33 +48 = 161 Aug. Cost Post unito $61040/16 1 = $379.13 Cast of Goods Sold 109 x 379.13 = $41325:17

ASSUMPTION -ALL GOODS ARE SOLD IN THE END OF Part B- THE YEAR Computation cost of Goods Sold 2019 - a-FIFO Method Balance of Invetorty on 31st Dec 2018- so, Cost of Goods sold of 128 unit is 1st 4 unit cost = next 48 unit Cost next 21 units Cost= next 32 units cost= next 23 units cost= 52 unit 1548 19344 8652 13792 10028 53364 17366 13516 B-LIFO METHOD- 1st 38 units Costa next 31 units Costa next 32units Cost next 21 units Costa next 6 units Costa 13792 8652 2418 55744 1548 19344 C-AVG COST METHOD TOTAL COST OF UNIT- 1st 4 unit cost next 48 unit Cost= next 21 units Costa next 32 units cost= next 31units Costa Next 38 units Costa 8652 13792 13516 17366 74218 Total no .of unit= 4+48+21+32+31+38 Ang cost per unit 426.54022988506 Cost of goods sold 54597.149425287 PART C- INCASE OF CHAENGE OF METHOD FROM FIFO TO LIFO- Due to change of method closing stock value are change and transfer to profit and loss alc Closing invetory value under fifo 4*387 48*403 1548 19344 20892 Closing invetory value under Lifo 23*349 18*355 11*372 8901 6390 4092 19383 Diffrence of Lifo and Fifo trf to Profit/loss a/c of amount $1509 PART D- SAME AS DONE IN PARTC CALCULATION NEED TO DONE IN 2019 Closing invetory value under fifo 8*436 38*457 3488 17366 20854 Closing invetory value under fifo 23*349 18*355 5*372 8901 6390 1860 17151 Diffrence of Lifo and Fifo trf to Profit/loss a/c of amount $3703