FIFO | LIFO | Average cost | |||||||||
The cost of ending inventory | $ 25,230 | $ 19,140 | $ 23,142 | ||||||||
The cost of goods sold | $ 67,570 | $ 73,660 | $ 69,426 | ||||||||
Working: | Units | Unit cost | Total Cost | ||||||||
a | a/b | b | |||||||||
a. | Beginning Inventory | 232 | $ 110 | $ 25,520 | |||||||
Purchase | 464 | $ 145 | $ 67,280 | ||||||||
Total | 696 | $ 92,800 | |||||||||
Ending inventory | 174 | ||||||||||
Units sold | 522 | ||||||||||
b. | FIFO stands for first-in-first-out.It means inventory bought first will be sold first. | ||||||||||
So, sales of 522 units will be made from: | |||||||||||
Beginning Inventory | 232 | $ 110 | $ 25,520 | ||||||||
Purchase | (balancing) | 290 | $ 145 | $ 42,050 | |||||||
Total | 522 | $ 67,570 | |||||||||
So, | |||||||||||
Cost of goods available for sale | $ 92,800 | ||||||||||
Cost of goods old | $ 67,570 | ||||||||||
Cost of Ending Inventory | $ 25,230 | ||||||||||
c. | LIFO stands for last in first out.It means inventory bought last will be sold first. | ||||||||||
So, sales of 522 units will be made from: | |||||||||||
Purchase | 464 | $ 145 | $ 67,280 | ||||||||
Beginning Inventory | (balancing) | 58 | $ 110 | $ 6,380 | |||||||
Total | 522 | $ 73,660 | |||||||||
So, | |||||||||||
Cost of goods available for sale | $ 92,800 | ||||||||||
Cost of goods old | $ 73,660 | ||||||||||
Cost of Ending Inventory | $ 19,140 | ||||||||||
d. | Average Method: | ||||||||||
Average cost per unit | = | $ 92,800 | / | 696 | |||||||
= | $ 133 | ||||||||||
Cost of goods sold | = | 522 | x | $ 133 | = | $ 69,426 | |||||
Ending Inventory | = | 174 | x | $ 133 | = | $ 23,142 | |||||
Total | $ 92,568 | ||||||||||
begi ingin at tal cost of S25 520. The company pu chased 464 uits at a...