Question

Altira Corporation provides the following information related to its merchandise inventory during the month of August 2021: Aug.1 Inventory on hand-3,300 units; cost $6.60 each. 8 Purchased 16,500 units for $6.80 each. 14 Sold 13,200 units for $13.30 each. 18 Purchased 9,900 units for $6.90 each. 25 Sold 12, 200 units for $12.30 each. 28 Purchased 5,300 units for $5.80 each. 31 Inventory on hand-9,600 units. Required: Using calculations based on a periodic inventory system, determine the inventory balance Altira would report in its August 31, 2021, balance sheet and the cost of goods sold it would report in its August 2021 income statement using each of the following cost flow methods.

Answer 1

Answer

FIFO	Cost of Goods available for sale			Cost of Goods Sold			Ending Inventory
	Units	Cost/unit	COG for sale	Units sold	Cost/unit	COGS	Units	Cost/unit	Ending inventory
Beginning Inventory	3300	$                   6.60	$                      21,780.00	3300	$                 6.60	$               21,780.00	0	$                   6.60	$                         -
Purchases:
08-Aug	16500	$                   6.80	$                    112,200.00	16500	$                 6.80	$            112,200.00	0	$                   6.80	$                         -
18-Aug	9900	$                   6.90	$                      68,310.00	5600	$                 6.90	$               38,640.00	4300	$                   6.90	$          29,670.00
28-Aug	5300	$                   5.80	$                      30,740.00	0	$                 5.80	$                              -	5300	$                   5.80	$          30,740.00
TOTAL	35000		$                    233,030.00	25400		$            172,620.00	9600		$          60,410.00