Question

Periodic Inventory Using FIFO, LIFO, and Weighted Average Cost Methods The units of an item available for sale during the year were as follows: Jan. 1 Inventory 11 units at $39 $429 July 7 Purchase 19 units at $40 760 Nov. 23 Purchase 4 units at $41 164 34 units $1,353 There are 17 units of the item in the physical inventory at December 31. The periodic inventory system is used. Determine the inventory cost using (a) the first-in, first-out (FIFO) method; (b) the last-in, first-out (LIFO) method; and (c) the weighted average cost method (round per unit cost to two decimal places and your final answer to the nearest whole dollar). a. First-in, first-out (FIFO) $ b. Last-in, first-out (LIFO) $ c. Weighted average cost $

Answer 1

Calculating closing inventory under period inventory method

Units Periodic Method Inventory Perticulars Opening Purchase Purchase Total Purchase Price Cost 11 39 429) 1940 760 4 41 164 34 1353 Weighted average method Weighted average cost = ( 1353 / 34 ) = Closing inventory = 17 * 39.79 = $676 39.79 FIFO Method Closing inventory = (4 * 41 ) + ( 13 * 40 ) = $684 LIFO Method Closing inventory = ( 11 * 39 ) +(6 * 40 ) = $669