Question

Ferris Company began January with 9,000 units of its principal product. The cost of each unit is $8. Merchandise transactions for the month of January are as follows:

	Purchases
Date of Purchase	Units		Unit Cost*			Total Cost
Jan. 10	6,000		$	9			$	54,000
Jan. 18	9,000			10				90,000
Totals	15,000							144,000

* Includes purchase price and cost of freight.

Sales
Date of Sale	Units
Jan. 5	5,000
Jan. 12	3,000
Jan. 20	6,000
Total	14,000

10,000 units were on hand at the end of the month.

1. Calculate January's ending inventory and cost of goods sold for the month using FIFO, periodic system.

FIFO Cost of Goods Available for Sale Cost of Goods Sold - Periodic FIFO Ending Inventory - Periodic FIFO # of units Cost per unit Cost of Goods Available for Sale # of units sold Cost per unit Cost of Goods Sold # of units in ending inventory Cost per unit Ending Inventory Beginning Inventory $0 $0.00 $0 $0.00 $0 Purchases: January 10 6,000 $9.00 54,000 $9.00 0 $9.00 0 January 18 0 $0.00 0 $0.00 0 Total 6,000 $54,000 0 $0 0 $0

2. Calculate January's ending inventory and cost of goods sold for the month using LIFO, periodic system.

LIFO Cost of Goods Available for Sale Cost of Goods Sold - Periodic LIFO Ending Inventory - Periodic LIFO # of units Cost per unit Cost of Goods Available for Sale # of units sold Cost per unit Cost of Goods Sold # of units in ending inventory Cost per unit Ending Inventory Beginning Inventory $0 $0.00 $0 $0.00 $0 Purchases: January 10 0 $0.00 0 $0.00 0 January 18 0 $0.00 0 $0.00 0 Total 0 $0 0 $0 0 $0

3. Calculate January's ending inventory and cost of goods sold for the month using FIFO, perpetual system.

Perpetual FIFO: Cost of Goods Available for Sale Cost of Goods Sold - January 5 Cost of Goods Sold - January 12 Cost of Goods Sold - January 20 Inventory Balance # of units Unit Cost Cost of Goods Available for Sale # of units sold Cost per unit Cost of Goods Sold # of units sold Cost per unit Cost of Goods Sold # of units sold Cost per unit Cost of Goods Sold # of units in ending inventory Cost per unit Ending Inventory Beg. Inventory $0 $0.00 $0 $0.00 $0 $0.00 $0 $8.00 $0 Purchases: January 10 0 0.00 0 0.00 0 0.00 0 0.00 0 January 18 0 0.00 0 0.00 0 0.00 0 0.00 0 Total 0 $0 0 $0 0 $0 0 $0 0 $0

  

Answer 1

Part 1

FIFO	Cost of Goods Available for Sale			Cost of Goods Sold - Periodic FIFO			Ending Inventory - Periodic FIFO
	# of units	Cost per unit	Cost of Goods Available for Sale	# of units	Cost per unit	Cost of Goods Sold	# of units in ending inventory	Cost per unit	Ending Inventory
Beginning Inventory	9000	8	72000	9000	8	72000
Purchases:
January 10	6000	9	54000	5000	9	45000	1000	9	9000
January 18	9000	10	90000				9000	10	90000
Total	24000		216000	14000		117000	10000		99000

Part 2

LIFO	Cost of Goods Available for Sale			Cost of Goods Sold - Periodic FIFO			Ending Inventory - Periodic FIFO
	# of units	Cost per unit	Cost of Goods Available for Sale	# of units	Cost per unit	Cost of Goods Sold	# of units in ending inventory	Cost per unit	Ending Inventory
Beginning Inventory	9000	8	72000				9000	8	72000
Purchases:
January 10	6000	9	54000	5000	9	45000	1000	9	9000
January 18	9000	10	90000	9000	10	90000
Total	24000		216000	14000		135000	10000		81000

Part 3

Perpetual FIFO	Cost of Goods Available for Sale			Cost of Goods Sold – January 5			Cost of Goods Sold – January 12			Cost of Goods Sold – January 20			Invention balance
	# of units	Cost per unit	Cost of Goods Available for Sale	# of units	Cost per unit	Cost of Goods Sold	# of units	Cost per unit	Cost of Goods Sold	# of units	Cost per unit	Cost of Goods Sold	# of units in ending inventory	Cost per unit	Ending Inventory
Beginning Inventory	9000	8	72000	5000	8	40000	3000	8	24000	1000	8	8000
Purchases:
January 10	6000	9	54000							5000	9	45000	1000	9	9000
January 18	9000	10	90000										9000	10	90000
Total	24000		216000	5000		40000	3000		24000	6000		53000	10000		99000