Question

Periodic inventory by three methods; cost of goods sold

The units of an item available for sale during the year were as follows:

Jan. 1	Inventory	30 units at $100
Mar. 10	Purchase	50 units at $112
Aug. 30	Purchase	30 units at $118
Dec. 12	Purchase	90 units at $122

There are 80 units of the item in the physical inventory at December 31. The periodic inventory system is used.

Determine the ending inventory cost and the cost of goods sold by three methods. Round interim calculations to one decimal and final answers to the nearest whole dollar.

Cost of Ending Inventory and Cost of Goods Sold
Inventory Method	Ending Inventory	Cost of Goods Sold
First-in, first-out (FIFO)	$	$
Last-in, first-out (LIFO)
Weighted average cost

Answer 1

Answer-

Cost of Ending Inventory and Cost of Goods Sold
Inventory Method	Ending Inventory	Cost of Goods Sold
First-in, first-out (FIFO)	$9,760	$13,360
Last-in, first-out (LIFO)	$8,600	$14,520
Weighted average cost	$9,248	$13,872

Cost of merchandise available for sale:-

Jan. 1	Inventory	30 units at $100	$3,000
Mar. 10	Purchase	50 units at $112	$5,600
Aug. 30	Purchase	30 units at $118	$3,540
Dec. 12	Purchase	90 units at $122	$10,980
		200 units (at an average cost of 115.60)	$23,120

First-in,first out:-

Merchandise Inventory:-

80 units at $122	$9,760
Merchandise sold = $23,120-$9,760	$13,360

Last-in, first out:-

Merchandise Inventory

30 units at $100	$3,000
50 units at $112	$5,600
80 units	$8,600

Merchandise sold

= $23,120-$8,600= $14,520

c-Weighted average method:-

Merchandise Inventory

80 units at $115.60 ($23,120/ 200 units)	$9,248
Merchandise sold $23,120-$9,248= $13,872