Question

Windsor Company was formed on December 1, 2016. The following information is available from Windsor’s inventory records for Product BAP. Units Unit Cost January 1, 2017 (beginning inventory) 612 $ 6.00 Purchases:    January 5, 2017 1,224 7.00    January 25, 2017 1,326 8.00    February 16, 2017 816 9.00    March 26, 2017 612 10.00 A physical inventory on March 31, 2017, shows 1,632 units on hand.

Prepare schedule to compute the ending inventory at March 31, 2017, under FIFO inventory method. WINDSOR COMPANY COMPUTATION OF INVENTORY FOR PRODUCT BAP UNDER FIFO INVENTORY METHOD March 31, 2017 Units Unit Cost Total Cost Beginning InventoryEnding InventoryPurchases January 5, 2017Purchases January 25, 2017Purchases February 16, 2017Purchases March 26, 2017 $ $ Beginning InventoryEnding InventoryPurchases January 5, 2017Purchases January 25, 2017Purchases February 16, 2017Purchases March 26, 2017 Beginning InventoryEnding InventoryPurchases January 5, 2017Purchases January 25, 2017Purchases February 16, 2017Purchases March 26, 2017 Beginning InventoryEnding InventoryPurchases January 5, 2017Purchases January 25, 2017Purchases February 16, 2017Purchases March 26, 2017 $

Answer 1

Schedule to compute the ending inventory at March 31, 2017, under FIFO inventory method:

WINDSOR COMPANY
COMPUTATION OF INVENTORY FOR PRODUCT
BAP UNDER FIFO INVENTORY METHOD
MARCH 31,2017
	Units	Unit cost	Total Cost
March 26,2017	612	$10.00	$6,120
February 16,2017	816	$9.00	$7,344
January 25,2017 (Portion)	204	$8.00	$1,632
March 31,2017 Inventory	1,632		$15,096

Explanation:

Under FIFO (First-in first-out) method, first purchased inventory to be sold first. So that, Ending inventory consists last purchased inventory. Hence ending inventory is counted from the last purchased inventory to tally physical count of 1,632 units.