Question

Inventory information for Part 311 of Bramble Corp. discloses the following information for the month of June. June 1 June 10 Sold 11 Balance Purchased Purchased 303 units @ $14 798 units @ $17 497 units @ $18 15 Sold Sold 201 units @ $34 498 units @ $35 299 units @ $38 20 27 (a) Your answer is incorrect. Assuming that the periodic inventory method is used, compute the cost of goods sold and ending inventory under (1) LIFO and (2) FIFO. (1) LIFO (2) FIFO Cost of Goods Sold $ Ending Inventory $

Answer 1

The answer has been presented in the supporting sheet. For detailed answer refer to the supporting sheet.

1 Answer 2 Cost of goods available for sales 3 = beginning inventory + purchases 4 = (303*14) + (798*17) + (497*18) 5 = $ 26754 6 7 No. of Units in ending inventory 8 = beginning + purchases - sales 9 = 303+798+497-(201+498+299) 10 = 600 Units 11 12 Cost of ending inventory FIFO 13 = No. of units in ending inventory * cost as per FIFO 14 =(497*18) + ((600-497) *17) 15 = $ 10697 16 17 Cost of ending inventory LIFO 18 = No. of units in ending inventory * cost as per LIFO 19 = (303*14) + ((600-303)*17) 20 = $ 9291 21 22 Cost of goods sold FIFO 23 = Cost of goods available for sale -ending inventory FIFO 24 = 26754 - 10697 25 = $ 16057

26 27 Cost of goods sold LIFO 28 = Cost of goods available for sale - ending inventory LIFO 29 = 26754 - 9291 30 = $ 17463 31 32 So the correct answer is 33 LIFO FIFO 34 Cost of goods sold 9291 10697 35 Ending Inventory 17463 16057 36 37