Question

Periodic inventory by three methods; cost of goods sold

The units of an item available for sale during the year were as follows:

Jan. 1	Inventory	40 units at $106
Mar. 10	Purchase	70 units at $116
Aug. 30	Purchase	20 units at $124
Dec. 12	Purchase	70 units at $126

There are 80 units of the item in the physical inventory at December 31. The periodic inventory system is used.

Determine the ending inventory cost and the cost of goods sold by three methods. Round interim calculations to one decimal and final answers to the nearest whole dollar.

Cost of Ending Inventory and Cost of Goods Sold
Inventory Method	Ending Inventory	Cost of Goods Sold
First-in, first-out (FIFO)	$	$
Last-in, first-out (LIFO)
Weighted average cost

Answer 1

Summary of answer
Periodic Inventory System	First in First out	Last in First out	Weighted Average
Cost of goods sold	13,600	14,780	14,196
Ending inventory	10,060	8,880	9,464

calculation

Unit sold = 200-80 = 120
Method	First-in, first-out (FIFO)		Periodic Inventory System
date	Goods Available for sale	Cost of goods sold	Ending inventory
Unit	unit cost	value	Unit	unit cost	value	Unit	unit cost	value
Beginning	40	106	4,240	40	106	4,240
Purchase	70	116	8,120	70	116	8,120
Purchase	20	124	2,480	10	124	1,240	10	124	1,240
Purchase	70	126	8,820				70	126	8,820
Total	200		23,660	120		13,600	80		10,060

Method	Last-in, first-out (LIFO)		Periodic Inventory System
date	Goods Available for sale	Cost of goods sold	Ending inventory
Unit	unit cost	value	Unit	unit cost	value	Unit	unit cost	value
Beginning	40	106	4,240				40	106	4,240
Purchase	70	116	8,120	30	116	3,480	40	116	4,640
Purchase	20	124	2,480	20	124	2,480
Purchase	70	126	8,820	70	126	8,820
Total	200		23,660	120		14,780	80		8,880

Method	Weighted average cost
date	Goods Available for sale
Unit	unit cost	value
Beginning	40	106	4,240
Purchase	70	116	8,120
Purchase	20	124	2,480
Purchase	70	126	8,820
Total	200		23,660
Cost of Goods Available for sale	23,660
Divided by: Units Available for sale	200
Weighted Average cost per unit	118.30
Cost of goods sold	120	118.30	14,196
Ending inventory	80	118.30	9,464