Question

eBook Show Me How Calculator Periodic Inventory by Three Methods The units of an item available for sale during the year were as follows: Jan. 1 Inventory 15 units at $47 Feb. 17 Purchase 12 units at $48 Jul. 21 Purchase 10 units at $50 Nov. 23 Purchase 7 units at $52 There are 13 units of the item in the physical inventory at December 31. The periodic inventory system is used. Round average unit cost to the nearest cent and final answers to the nearest whole dollar, if required. a. Determine the inventory cost by the first-in, first-out method. b. Determine the inventory cost by the last in, first-out method. c. Determine the inventory cost by the weighted average cost method.

Answer 1

Date	Particulars	Units	Unit rate	Amount
Jan.1	Inventory	15	$47	$705
Feb.17	Purchase	12	48	576
Jul.21	Purchase	10	50	500
Nov.23	Purchase	7	52	364
Cost of goods available		44		$2,145

Ending inventory in units = 13 units

a. FIFO :

Inventory = $364 (7*$52) + 6 (13-7)*$50

Inventory = $364 + 300 = $664

b. LIFO:

Inventory = 13*$47 = $611

c. Weighted average:

Average cost per unit = $2,145 / 44 = $48.75

Inventory = 13*$48.75 = $634