Question

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Jessica's Office Supply, Inc., had 300 calculators on hand at January 1, 2017, costing $16 each. Purchases and sales of calculators during the month of January were as follows: Purchases Sales 200 @ $25 Date January 12 14 29 30 150 @ $17 100 @ $18 150 @ $30 Jessica does not maintain perpetual inventory records. According to a physical count, 200 calculators were on hand at January 31, 2017. Required: 1. What is the amount of ending inventory at January 31, 2017, and cost of goods sold for the month ended January 31, 2017, under the FIFO method? 2. What is the amount of ending inventory at January 31, 2017, and cost of goods sold for the month ended January 31, 2017, under the LIFO method? 3. What is the amount of ending inventory at January 31, 2017, and cost of goods sold for the month ended January 31, 2017, under the average cost method? (Do not round intermediate calculations. Round your answers to the nearest whole dollar amount.) Ending inventory at January 31, 2017 Cost of Goods Sold January 31, 2017 1. FIFO 2. LIFO 3. Average cost

Answer 1

H FIFO METHOD Units Rate Amount Opening 300 16 4800 Sale -200 16 -3200 Balance 100 16 1600 - Purchase 150 17 2550 Purchase 100 18 1800 Sale -100 16 - 1600 -50 17 -850 Balance 100 17 1700 1 100 18 1800 2 3500 3 Cost of goods sold= 3200+1600+850=5650 4 Ending imventory= 3500 5 LIFO METHOD Units Rate Amount Opening 300 16 4800 Sale -200 16 -3200 Balance 100 16 1600 Purchase 150 17 2550 Purchase 100 18 1800 Sale -100 18 - 1800 -50 17 -850 Balance 100 17 1700 100 16 1600 3300 Cost of goods sold=3200+1800+850= $5850 Ending inventory= $3300 MI AVERAGE COST METHOD Units Rate Amount Opening 300 16 4800 Sale -200 16 -3200 Balance 100 16 1600 Purchase 150 17 2550 Balance 250 16.6 4150 Purchase 100 18 1800 Balance 350 17 5950 Sale -150 17 -2550 Balance 200 17 3400 Cost of goods sold= 3200+2550= $5750 Ending inventory= $3400