Question

I need help with the following question. I can not get my answers to match for the cost of goods sold on the question below

Laker Company reported the following January purchases and sales data for its only product. Date Activities Units Acquired at Cost Units Sold at Retail Jan. 1 Beginning inventory 290 units @ $9.80 = $ 2,842 Jan. 10 Sales 160 units @$17.80 Jan. 20 Purchase 360 units @ $8.80 = 3,168 Jan. 25 Sales 285 units @$17.80 Jan. 30 Purchase 230 units @ $7.80 = 1,794     Totals 880 units $ 7,804 445 units

The Company uses a perpetual inventory system. For specific identification, ending inventory consists of 435 units, where 230 are from the January 30 purchase, 80 are from the January 20 purchase, and 125 are from beginning inventory.

Required:

1.	Complete comparative income statements for the month of January for Laker Company for the four inventory methods. Assume expenses are $3,000, and that the applicable income tax rate is 39%. (Do not round your Intermediate calculations.)

	LAKER COMPANY Income Statements For Month Ended January 31 Specific Weighted Identification Average FIFO LIFO Sales $7,921 $7,921 $7,921 $7,921 Cost of goods sold 4,081 4,152 4,206 4,076 Gross profit 3,840 3,769 3,715 3,845 Expenses 3,000 3,000 3,000 3,000 Income before taxes 840 769 715 845 Income tax expense 328 300 279 330 Net income $512 $469 $436 $515

Answer 1

1)Specific identification:

cost of ending inventory:[230*7.8]+[80*8.8]+[125*9.8]

       = 1794+ 704+ 1225

       = 3723

Cost of goods sold = Cost of goods available for sale- ending inventory

              = 7804-3723

               = 4081..

2)FIFO :under First in first out units acquired first are sold first.

	Purchase			Cost of goods sold			Ending inventory
	unit	unit cost	Total	unit	unit cost	Total	unit	unit cost	total
Beginning							290	9.8	2842
jan 10				160	9.8	1568	290-160=130	9.8	1274
jan 20	360	8.8	3168				130	9.8	1274
							360	8.8	3168
jan 25				130	9.8	1274
				285-130= 155	8.8	1364	360-155= 205	8.8	1804
jan 30	230	7.8	1794				205	8.8	1804
							230	7.8	1794
				cost of goods sold		4206

3)LIFO :units acquired last are sold first.

	Purchase			Cost of goods sold			Ending inventory
	unit	unit cost	Total	unit	unit cost	Total	unit	unit cost	total
Beginning							290	9.8	2842
jan 10				160	9.8	1568	290-160=130	9.8	1274
jan 20	360	8.8	3168				130	9.8	1274
							360	8.8	3168
jan 25				285	8.8	2508	130	9.8	1274
							360-285= 75	8.8	660
jan 30	230	7.8	1794				130	9.8	1274
							75	8.8	660
							230	7.8	1794
				cost of goods sold		4076

d)weighted average :units are sold average cost calculated at time of each purchase.

	Purchase			Cost of goods sold			Ending inventory
	unit	unit cost	Total	unit	unit cost	Total	unit	unit cost	total
Beginning							290	9.8	2842
jan 10				160	9.8	1568	290-160=130	9.8	1274
jan 20	360	8.8	3168				130+360= 490	9.06531   [(1274+3168)/490]	4442
jan 25				285	9.06531	2583.61	490-285= 205	9.06531	1858.39
jan 30	230	7.8	1794				205+230=435	8.39630    [(1858.39+1794)/435]	3652.39
				cost of goods sold		4151.61 (rounded to 4152)