Question

Cortez Company sells chairs that are used at computer stations. Its beginning inventory of chairs was 90 units at $40 per unit. During the year. Cortez made two batch purchases of this chair. The first was a 170-unit purchase at $45 per unit: the second was a 208-unit purchase at $48 per unit. During the period, it sold 288 chairs. Required Determine the amount of product costs that would be allocated to cost of goods sold and ending inventory, assuming that Cortez uses a. FIFO: FIFO From beginning inventory From first purchase From second purchase Total Units 90 170 28 Unit Cost $ 40 45 48 @ @ = = = Cost of Goods Sold $ 3,600 7,650 1,344 $ 12,594 Units Unit Ending Cost Inventory 5 1,344 "Red text Indicates no response was expected in a cell or a formula-based calculation is incorrect; no points deducted. FIFO From second purchase 2 8 @ 48 -

I am not sure why some of my answers were incorrect, please show me some details on how you get your answers. Thank you.

Answer 1

The answer has been presented in the supporting sheet. All the parts has been solved with detailed explanation and format. For detailed answer refer to the supporting Sheet.

Answer 2 FIFO 3 Table 2 FIFO Units Unit Cost 48 Ending inventory 8640 @ 5 From Second Purchase 6 180 (208-28) 8 LIFO 9 Table 2 LIFO Units Unit Cost Ending inventory 3600 4050 11 From Beginning Inventory 12 From First Purchase 90 90 (170-80) @ @ 40 45 13 15 Weighted average 16 Firstly we have to calculate weighted average cost 17 = Total cost of goods avilable for sale / no. of units 18 = ((90*40)+(170*45)+(208*48)/(90+170+208) 19 = 45.371 per unit 20 = $45 (rounded off to nearest whole number as given in question 22 Cost of goods sold 288 units @ 45) = 13067 23 Ending Inventory 180 units @ 45 = 8167 24 25 Note the final answer has been calculated by considering the per unit cost which has not been rounded off.