Question

Calculate the cost of ending inventory and the cost of goods sold under the (a) FIFO b) LIFO, and (c) weighted average cost methods. (Do not round your intermediate calculations. Round "Weighted Average Cost" to 2 decimal places.)

Spotter Corporation reporteu le IUIUWING TUI JUIC E Date Description Units Unit Cost June 1 Beginning 24 $11.20 11 Purchase 40 12.20 24 Purchase 36 14.20 30 Ending Total Cost $268.80 488.00 511.20 Required: 1. Calculate the cost of ending inventory and the cost of goods sold under the (a) FIFO, (b) LIFO, and (c) weighted average cost methods. (Do not round your intermediate calculations. Round "Weighted Average Cost" to 2 decimal places.) Cost of Ending Cost of Goods Inventory Sold FIFO LIFO Weighted Average Cost

Answer 1

• Requirement 1

Methods	Ending Inventory	Cost of Goods Sold
FIFO	$                  560.00	$                     708.00
LIFO	$                  464.00	$                     804.00
Weighted average cost	$                  507.20	$                     760.80

• Requirement 2

Highest Net Income

FIFO

because prices are rising and ending inventory is inflated and cost of goods sold is less, which leads to higher gross profits and higher net income.

• Working

FIFO	Cost of Goods available for sale			Cost of Goods Sold			Ending Inventory
	Units	Cost/unit	COG for sale	Units sold	Cost/unit	COGS	Units	Cost/unit	Ending inventory
Beginning Inventory	24	$                11.20	$                            268.80	24	$               11.20	$                     268.80	0	$                 11.20	$                         -
Purchases:
11-Jun	40	$                12.20	$                            488.00	36	$               12.20	$                     439.20	4	$                 12.20	$                  48.80
24-Jun	36	$                14.20	$                            511.20	0	$               14.20	$                              -	36	$                 14.20	$                511.20
TOTAL	100		$                        1,268.00	60		$                     708.00	40		$                560.00
LIFO	Cost of Goods available for sale			Cost of Goods Sold			Ending Inventory
	Units	Cost/unit	COG for sale	Units sold	Cost/unit	COGS	Units	Cost/unit	Ending inventory
Beginning Inventory	24	$                11.20	$                            268.80	0	$               11.20	$                              -	24	$                 11.20	$                268.80
Purchases:
11-Jun	40	$                12.20	$                            488.00	24	$               12.20	$                     292.80	16	$                 12.20	$                195.20
24-Jun	36	$                14.20	$                            511.20	36	$               14.20	$                     511.20	0	$                 14.20	$                         -
TOTAL	100		$                        1,268.00	60		$                     804.00	40		$                464.00
Average Method	Cost of Goods available for sale			Cost of Goods Sold			Ending Inventory
	Units	Cost/unit	COG for sale	Units sold	Cost/unit	COGS	Units	Cost/unit	Ending inventory
Beginning Inventory	24	$                11.20	$                            268.80
Purchases:
11-Jun	40	$                12.20	$                            488.00
24-Jun	36	$                14.20	$                            511.20
TOTAL	100	$              12.680	$                        1,268.00	60	$          12.6800	$                     760.80	40	$            12.6800	$                507.20