Question

E6-29. Computing Cost of Sales and Ending Inventory (102) Stocken Company has the following financial records for the current period. Units 100 650 550 Unit Cost $46 Beginning inventory Purchases: #1.. #2. 42 38 36 #3. 200 Ending inventory is 350 units. Compute the ending inventory and the cost of goods sold for the current period using (a) first-in, first out, (b) average cost, and (c) last-in, first-out.

Answer 1

Solution a:

Computation of COGS and ending inventory - Periodic FIFO
Particulars	Cost of goods available for sale	Cost of goods sold	Ending Inventory
Nos of units	Unit Cost	Cost of goods available for sale	Nos of units sold	Unit Cost	Cost of goods sold	Nos of units in ending inventory	Unit Cost	Ending inventory
Beginning inventory	100	$46.00	$4,600	100	$46.00	$4,600	0	$46.00	$0
Purchases:
Purchase 1	650	$42.00	$27,300	650	$42.00	$27,300	0	$42.00	$0
Purchase 2	550	$38.00	$20,900	400	$38.00	$15,200	150	$38.00	$5,700
Purchase 3	200	$36.00	$7,200	0	$36.00	$0	200	$36.00	$7,200
Total	1500		$60,000	1150		$47,100	350		$12,900

Solution b:

Computation of COGS and ending inventory - Periodic Weighted Average cost method
Particulars	Cost of goods available for sale	Cost of goods sold - Average cost	Ending Inventory - Average cost
Nos of units	Unit Cost	Cost of goods available for sale	Nos of units sold	Unit Cost	Cost of goods sold	Nos of units in ending inventory	Unit Cost	Ending inventory
Beginning inventory	100	$46.00	$4,600
Purchases:
Purchase 1	650	$42.00	$27,300
Purchase 2	550	$38.00	$20,900
Purchase 3	200	$36.00	$7,200
Total	1500	$40.00	$60,000	1150	$40.00	$46,000	350	$40.00	$14,000

Solution c:

Computation of COGS and ending inventory - Periodic LIFO
Particulars	Cost of goods available for sale	Cost of goods sold	Ending Inventory
Nos of units	Unit Cost	Cost of goods available for sale	Nos of units sold	Unit Cost	Cost of goods sold	Nos of units in ending inventory	Unit Cost	Ending inventory
Beginning inventory	100	$46.00	$4,600	0	$46.00	$0	100	$46.00	$4,600
Purchases:
Purchase 1	650	$42.00	$27,300	400	$42.00	$16,800	250	$42.00	$10,500
Purchase 2	550	$38.00	$20,900	550	$38.00	$20,900	0	$38.00	$0
Purchase 3	200	$36.00	$7,200	200	$36.00	$7,200	0	$36.00	$0
Total	1500		$60,000	1150		$44,900	350		$15,100