Question

Alrcard Corporation 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. The following are the transactions for the month of July. Unit Cost $20 July 1 July 5 July 13 July 17 July 25 July 27 Reginning Inventory Sold Purchased Sold Purchased Sold Units 2,000 1,000 6.000 3,000 8.000 5.000 Calculate the cost of goods available for sale, ending Inventory, and cost of goods sold if Aircard uses (a) FIFO, (b) LIFO, or (c) weighted average cost. (Round "Cost per Unit" to 2 decimal places.) FIFO L IFO Weighted Average Cost Cost of Goods Available for Sale Ending Inventory Cost of Goods Sold

Answer 1

Sol. Cost of goods available - method's for saule is same for all Unit Cost I Particularis I Units Beginning Inventory | 2000 | Add: Purchase on July 13 6,000 | Add: - Purchase on July 25 8000 I Cost of Goods available for sale! 16000 $ 22 $24 Total Cast $40,000 | $132,000 $ 192.000 $364,000 Cost of Goods Available for Sale = $364.000

Sol Under fifo (first in first out) Method :- Cost of Good's Sould = (1,000 V wie's x $20 ) +(1,000 Wails x$20 + 2000wwys x $22)+ +(4000 llawiki's X $22 + 1000 quil's x $24) = = a $20,000 + ($20,000 + $44.000 ) +($88000 + $24000) $20,000+ $ 64.000 + $112.000 $196,000 Ending leventory a = Cost of goods Available for scule- Cosco Of goods sold Eost of Food Awailable for sale - 16,000 Quil's of $3.64,000 Cost of goods sold - 9000 vuit's of $196,000 ory = 7000 Cails 04 $168,000 U OR = 7ooo vuils X $24 $168000

Sol Under Lifo Chase in firsfouk) method in Cost of goods sold > Ol = (1 000 Muilas X $20)+( 3poo vuiles X 822 ) + (5poo buits X $24) $20000 + $ 66.000 + $120,000 - $206,000 Ending Inventory as Cost of goods Available for Sale - Cost of good, - sold Cable of food Awarlabele for Sales 16000 lluil's off $364.000 Cosi- of goods Sould = 9000 units of $206,000 Ending luwentory - Youo laikis of $158.000 S OR z (1000 units X $20) +(3000 wait-x $22)+(3000 Wi-X$$24) ç $20000 + $ 66.000 + $72,000 = $158.000

Sol Dudes weighted Avenge coc methodic weighted Average lose of lawentory ay = Actual Cost of all Inventory Total Unilis available for sale $364,000 16ooo cuilis $22.75 - - Cazr of qvaels Sodel -> = $22.95 9000 Ucilis & $ 204,750 hve Ending Inventory =) 4 $22.75 = 7ooo Gulos X = $159.250 OR - Cash of foud's Available for Sale - Cost of foods solel $ 864,000 - $ 204,750 $ 159,250