Question

Required information [The following information applies to the questions displayed below.] The following information pertains to Mason Company for Year 2: Beginning inventory Units purchased 124 units @ $ 34 374 units @ $ 51 Ending inventory consisted of 46 units. Mason sold 452 units at $102 each. All purchases and sales were made with cash. Operating expenses amounted to $3,525. b. What is the amount of net income using FIFO, LIFO, and weighted average? (Ignore income tax considerations.) (Round cost per unit to 3 decimal places and other intermediate answers and final answers to the nearest whole dollar amount.) Net Income FIFO LIFO Weighted average

Answer 1

Solution

	Net Income
FIFO	$     21,635
LIFO	$     20,853
Weighted Average	$     21,440

Working

	Sales	Cost of Goods sold	Gross profit	Operating Expenses	Net Income
FIFO	$               46,104	$                 20,944	$           25,160	$              3,525	$   21,635
LIFO	$               46,104	$                 21,726	$           24,378	$              3,525	$   20,853
Weighted Average	$               46,104	$                 21,139	$           24,965	$              3,525	$   21,440

.

Average Cost of Inventory
Units	(A)	498
Total Cost	(B)	$ 23,290
Average Cost	(C=B/A)	$                 46.767

.

FIFO
Total Units Available for sale		498
Units Sold		452
Closing Stock in Units		46
Valuation
Ending Inventory	46	@	$             51.00	$ 2,346
Value Of Ending Inventory				$              2,346
Cost of Goods sold				$            20,944
LIFO
Total Units Available for sale		498
Units Sold		452
Closing Stock in Units		46
Valuation
Ending Inventory	46	@	$             34.00	$ 1,564
Value Of Ending Inventory				$              1,564
Cost of Goods sold				$            21,726
Weighted Average method
Total Units Available for sale		498
Units Sold		452
Closing Stock in Units		46
Valuation
Ending Inventory	46	@	$           46.767	$              2,151
Value Of Ending Inventory				$              2,151
Cost of Goods sold	(Total Purchase and opening stock Minus Closing Stock)			$            21,139