Question

Scrappers Supplies tracks the number of units purchased and sold throughout each accounting period but applies its inventory costing method at the end of each period, as if it uses a periodic inventory system. Assume its accounting records provided the following information at the end of the annual accounting period, December 31.

Transactions		Units			Unit Cost
Beginning inventory, January 1			170		$	32
Transactions during the year:
a.	Purchase on account, March 2		330			34
b.	Cash sale, April 1 ($48 each)		(320	)
c.	Purchase on account, June 30		220			38
d.	Cash sale, August 1 ($48 each)		(80	)

TIP: Although the purchases and sales are listed in chronological order, Scrappers determines the cost of goods sold after all of the purchases have occurred.

Required:
1.	Compute the cost of goods available for sale, cost of ending inventory, and cost of goods sold at December 31 under each of the following inventory costing methods: (Round "Cost per Unit" to 2 decimal places.)

a.	Last-in, first-out.

b.	Weighted average cost.

c.	First-in, first-out.

d.	Specific identification, assuming that the April 1 sale was selected one-fifth from the beginning inventory and four-fifths from the purchase of March 2. Assume that the sale of August 1 was selected from the purchase of June 30.

Answer 1

5440 LIFO ( Periodic) Cost Per # of Units Unit Total Beginning Inventory 170 32 Purchases Mar-02 330 Jun-30 220 Total Purchases 550 Goods Available for Sales 720 cost of Goods Sold Units from Beginning inventory Units From March 2 Purchase 180 Units From June 30 Purchases 220 Total Cost of Goods sold Ending invntory 320 11220 8360 19580 25020 6120 8360 14480 10540 400

Total 5440 Weighted Average (Periodic) Cost Per # of Units Unit Beginning Inventory 170 32 Purchases Mar-02 330 Jun-30 220 Total Purchases 550 Goods Available for Sales 720 cost of Goods Sold 400 34.75 Ending invntory 320 34 38 11220 8360 19580 25020 13900 111201

5440 FIFO ( Periodic) Cost Per # of Units Unit Total Beginning Inventory 170 32 Purchases Mar-02 330 34 Jun-30 220 38. Total Purchases 5501 Goods Available for Sales 720 cost of Goods Sold Units from Beginning inventory 1701 Units From March 2 Purchase 230 34 Units From June 30 Purchases 0 Total Cost of Goods sold Ending invntory 320 112201 8360 195801 25020 5440 7820 4001 13260 11760

Total 5440 38 Specific Identificatio (Periodic) Cost Per # of Units Unit Beginning Inventory 170 32 Purchases Mar-02 330 34 Jun-30 220 Total Purchases 550 0 Goods Available for Sales 720 cost of Goods Sold Units from Beginning inventory 64 Units From March 2 Purchase 256 34 Units From June 30 Purchases 80 Total Cost of Goods sold 400 Ending invntory 320 11220 8360 19580 25020 32 38 2048 8704 3040 13792 11228