Question

Problem II (15 points): Vaughn Company had a beginning inventory on May 1, of 400 units of Product A at a cost of $7 per unit. During May, the following purchases and sales were made. Purchases 375 Sales May 6 14 units at $9 units at $10 units at $11 units at $13 Мау 4 8 275 units units 250 300 450 225 1,250 21 300 425 1.350 22 units 28 24 units Instructions: Compute the May 31 cost of ending inventory and May cost of goods sold under (a) Average Cost, (b) FIFO, and (c) LIFO. Provide appropriate supporting calculations. (a) Average -Ending Inventory S Cost of Goods Sold $ (b) FIFO-Ending Inventory $ Cost of Goods Sold S (c) LIFO Ending Inventory $ Cost of Goods Sold $ nt

Answer 1

ANSWER

As per the given question,

weighted average cost method a) cost of goods available for sale cost of goods sold unit price total ending inventory units unit pric total date units unit price total units beginning May-01 inventory May-06 purchases May-14 purchases May-21 May-28 400 375 7 2800 1300 450 10 13000 10 4500 9 3375 250 300 10 2500 11 13 3300 5525 17500 purchases 425 purchases total 4500 1300 1750 13000 450 cost of goods avilable for sale/ total units =$17500/1750=$ 10 weighted average cost per unit answers ending inventory may cost of goods sold may 4500 13000

b

Closing Stock 4001350 1300 450 Ending Inventory May-28 425 units x $13 5525 May-21 25 Units x $11 275 5800 Cost of goods sold Beginning Inventory Purchase - closing stock = (400 x 7)(375 x 9 250 x 10+300 x 11+425 x 13) - 5800 = 280014700 5800 = 11700

c

Total Cost available for sale = 2800+3375+2500+3300+5525 = 17500

Total Units available for sale = 1350+400 = 1750 Units

Sale unit = 1300 Units

Ending inventory = 1750-1300 = 450 Units

Cost of ending inventory = (400*7+50*9) = 3250

Cost of goods sold = 17500-3250 = $14250

THANK YOU FOR THE QUESTION.....KINDLY RATE....IT HELPS ME A LOT