Question

Requirement 1. Compute cost of goods sold and gross profit using the FIFO inventory costing method.

Begin by computing the cost of goods sold and cost of ending merchandise inventory using the FIFO inventory costing method. Enter the transactions in chronological​ order, calculating new inventory on hand balances after each transaction. Once all of the transactions have been entered into the perpetual​ record, calculate the quantity and total cost of merchandise inventory​ purchased, sold, and on hand at the end of the period.​ (Enter the oldest inventory layers​ first.)

	Purchases			Cost of Goods Sold			Inventory on Hand
		Unit	Total		Unit	Total		Unit	Total
Date	Quantity	Cost	Cost	Quantity	Cost	Cost	Quantity	Cost	Cost
May 1
11
23
26
29
Totals

Compute gross profit using the FIFO inventory costing method.

Gross profit is $

using the FIFO inventory costing method.

Requirement 2. Compute cost of goods sold and gross profit using the LIFO inventory costing method.

Begin by computing the cost of goods sold and cost of ending merchandise inventory using the LIFO inventory costing method. Enter the transactions in chronological​ order, calculating new inventory on hand balances after each transaction. Once all of the transactions have been entered into the perpetual​ record, calculate the quantity and total cost of merchandise inventory​ purchased, sold, and on hand at the end of the period. ​(Enter the oldest inventory layers​ first.)

	Purchases			Cost of Goods Sold			Inventory on Hand
		Unit	Total		Unit	Total		Unit	Total
Date	Quantity	Cost	Cost	Quantity	Cost	Cost	Quantity	Cost	Cost
May 1
11
23
26
29
Totals

Compute gross profit using the LIFO inventory costing method.

Gross profit is $

using the LIFO inventory costing method.

i More Info May 1 Beginning merchandise inventory 11 Purchase 16 tires @ 10 tires @ 12 tires @ 14 tires @ $ $ $ $ 65 each 78 each 88 each 80 each 23 Sale 26 Purchase 29 Sale 18 tires @ $ 88 each Print Done

Answer 1

FIFO
	purchase			cost of goods sold			balanced inventory
date	unit	rate per unit	total	unit	rate per unit	total	unit	rate per unit	total
01-May	16	65	1,040				16	65	1,040
11-May	10	78	780				16	65	1,040
							10	78	780
23-May	-	-	-	12	65	780	4	65	260
							10	78	780
26-May	14	80	1,120				4	65	260
							10	78	780
							14	80	1,120
29-May	-	-	-	4	65	260
				10	78	780
				4	80	320	10	80	800
	40		2,940	30		2140	10		800

LIFO
	purchase			cost of goods sold			balanced inventory
date	unit	rate per unit	total	unit	rate per unit	total	unit	rate per unit	total
01-May	16	65	1,040				16	65	1,040
11-May	10	78	780				16	65	1,040
							10	78	780
23-May	-	-	-	10	78	780
				2	65	130	14	65	910
26-May	14	80	1,120				14	65	910
							14	80	1,120
29-May	-	-	-	14	80	1,120
				4	65	260	10	65	650
	40		2,940	30		2290	10		650

	FIFO	LIFO
sale	2,640	2,640
cost of goods sold	2,140	2,290
gross profit	500	350