Question

le cost of materials issued into production and the cost of the August 31 inventory under each of the following costing methods (Round per unit amounts to three decimal places and total amounts to the nearest dollar.): 1. FIFO 2. LIFO 3. Weighted average E2-7 FIFO costing Using first-in, first-out perpetual inventory costing and the follow- ing information, determine the cost of materials used and the cost of the July 31 inventory: LO3 July 1 3 la 5 6 10 11 Balance on hand, 1,000 yd of linen @ $4.00 each. Issued 250 yd. Received 500 yd @ $4.50 each. Issued 150 yd. Issued 110 yd. Factory returned 10 yd, which were issued on the 10th, to the storeroom. Received 500 yd @ $5.00 each. Returned 300 yd to the vendor from the July 15 purchase. Issued 600 yd. 15 26

Answer 1

Date Qty 1-Jul Receipt Rate Amt Stores Ledger (FIFO) Issue Qty Rate Amt Qty Balance Rate 1000 4 Remarks Amt 4000 Beginning balance 3-Jul 25014100075043000 5-Jul 500 4.5 2250 750 3000 2250 500 6-Jul 600 2400 2250 5001 4.5 10-Jul 440 490 5001 1960 2250 4.5 11-Jul 10 490 40 Return from factory 1960 2250 500 4.5 15-Jul 500 5 2500 40 1960 2250 2500 20-JU 40 Return to supplier 1960 2250 1000 26-Jul 400 200 1800 10001 490 1960 450 100 Total issue 5990 Ending Inventory 2800|

Cost of materials used = Total issue - Return to supplier = 5590 - 1500 = $4,090 Ending Inventory, July, 31 = $2,800