Question

unting II Assignment Chapter 6 DUE - Monday, January 14th, 2019 @ 8:30 am A company made the following purchases during the yesrs 1. Jan. 10 15 units at $390 Mar. 15 25 units at $420 Apr. 25 10 units at $450 July 3020 units at $480 Oct. 10 15 units at $510 her 31, there were 28 units in ending inventory. nDece anuary 10 shipment, 2 from the March 15 shipment, 5 from the April 25 the 15 from the July 30 shipment, and 5 from the October 10 shipment. On December ,ed These 28 units consisted of I sh ising specific identification, calculate the cost of the ending inventory and cost of goods sold sing FIFO, calculate the cost of the ending inventory and cost of goods sold.

(a) Using specific identification, calculate the cost of the ending inventory and cost of goods sold.

(b) Using FIFO, calculate the cost of the ending inventory and cost of goods sold.

Answer 1

solution: Part a: Specific identification:In this method cost of particular lot of units sold is identified separately and cost is charged accordingly Part b: FIFO: In this method, earliest purchase is assumed to be sold first, hence ending inventory is consist of latest purchases. cost of ending inventory 13890 cost of goods sold cost of Goods available for sale Less: ending inventory cost of goods sold cost of ending inventory 1 390+2 420+5*450+15*480+5 510 13230 38100 13890 24210 cost of goods sold Purchases Jan 10. Mar 15. Apr 25 July 30 oct. 10 cost of Goods available for sale Less : ending invento cost of goods sold units unit cost total cost 5850 15 25 10 20 15 390 420 10500 450 480 510 4500 9600 38100 13230 24870 Shee146 Sheed 147 Sheet1148Shee1149Sheet1150 Sheet1 151 Sheet1152Sheet1153 ENG US 22/01/2019