Question

3 Ferris Company began 2016 with 6,000 units of its principal product. The cost of each unit is $9. Merchandise transactions for the month of January 2016 are as follows Purchases 1.5 points Date of Purchase Jan. 10 Jan. 18 Unit Units Cost Total Cost 5,000 $10 $50,000 6,000 eBook 66,000 Print Totals 11,000 $116,000 References Includes purchase price and cost of freight. Sales Date of Units 3,000 2,000 4,000 Sale Jan. 5 Jan. 12 Jan. 20 Total 9,000 8,000 units were on hand at the end of the month. 8,000 units were on hand at the end of the month. Required: Calculate January's ending inventory and cost of goods sold for the month using each of the following alternatives Cost of Goods Available for Sale Cost of Goods Sold Periodic FIFO Cost of Goods Sale Ending Inventory - Periodic FIFO # of units Cost per inventory # of units sold Cost per unit Ending Inventory Cost of #of units | Cost per unit Available for Goods Sold in ending unit $ 0.00 $ $ 0.00 $ Beginning Inventory Purchases January 10 January 18 $ 0.00 $0.00 $ 0.00 $0.00 Total Cost of Goods Available for Sale Cost of Goods Sold Periodic LIFO Cost of Goods Sale Ending Inventory - Periodic LIFO # of units Cost per inventory # of units sold Cost per unit Ending Inventory Cost of #of units | Cost per unit Available for Goods Sold in ending unit $ 0.00 $ $ 0.00 $ Beginning Inventory Purchases January 10 January 18 $ 0.00 $0.00 $ 0.00 $0.00 Total Cost of Goods Available for Sale Cost of Goods Sold-January 5 Cost of Perpetual LIFO #of # of Cost per Goods units unit Available forunits Sale Cost per unit Cost of Goods Sold sold Beg. Inventory $0.00$ Purchases January 10 January 18 0.00 0.00 Total Cost of Goods Sold- January 12 Cost of Goods Sold-January 20 Inventory Balance # of units | Cost per # of units sold cost per unit Cost of | # of units Cost per Goods Sold sold Ending Inventory unit Goods Sold I in ending unit inventory $0.00$ $ 0.00$ $0.00$ 0.00 0.00 0.00 0.00 0.00 0.00

Answer 1

Periodic FIFO :-

FIFO	Cost of Goods Available for Sale			Cost of Goods Sold-Periodic FIFO			Ending Inventory-Periodic FIFO
	# of units	Cost pu	Cost of Goods Available for Sale	# of units	Cost pu	Cost of Goods Sold-Periodic FIFO	# of units	Cost pu	Ending Inventory-Periodic FIFO
Beginning Inventory	6000	$9	$54000	6000	$9	$54000
Purchases:-
Jan 10	5000	10	50000	3000	10	30000	2000	$10	$20000
Jan 18	6000	11	66000				6000	11	66000
Total	17000		$170000	9000		$84000	8000		$86000

Periodic LIFO :-

LIFO	Cost of Goods Available for Sale			Cost of Goods Sold-Periodic LIFO			Ending Inventory-Periodic LIFO
	# of units	Cost pu	Cost of Goods Available for Sale	# of units	Cost pu	Cost of Goods Sold-Periodic FIFO	# of units	Cost pu	Ending Inventory-Periodic FIFO
Beginning Inventory	6000	$9	$54000				6000	$9	$54000
Purchases:-
Jan 10	5000	10	50000	3000	$10	$30000	2000	10	20000
Jan 18	6000	11	66000	6000	11	66000
Total	17000		$170000	9000		$96000	8000		$74000

Average Cost:-

	Cost of Goods Available for Sale			Cost of Goods Sold			Ending Inventory
	# of units	Cost pu	Cost of Goods Available for Sale	# of units	Cost pu	Cost of Goods Sold-Periodic FIFO	# of units	Cost pu	Ending Inventory-Periodic FIFO
Beginning Inventory	6000	$9	$54000	9000           $10           $90000			8000             $10                $80000
Purchases:-
Jan 10	5000	10	50000
Jan 18	6000	11	66000
Total	17000		$170000	9000		$90000	8000		$80000

Avg cost per unit = Total cost available for sale/No of units available for sale

     = $170000/17000 = $10

Perpetual LIFO:-

LIFO	Cost of Goods Available for Sale			Cost of Goods Sold-January 5
	# of units	Cost pu	Cost of Goods Available for Sale	# of units	Cost pu	Cost of Goods Sold
Beginning Inventory	6000	$9	$54000	3000	$9	$27000
Purchases:-
Jan 10	5000	10	50000
Jan 18	6000	11	66000
Total	17000		$170000	3000		$27000

Cost of Goods Sold- January 12			Cost of Goods Sold- January 20			Inventory Balance
# of units	Cost pu	Cost of Goods Sold	# of units	Cost pu	Cost of Goods Sold	# of units	Cost pu	Ending Inventory
						3000	$9	$27000
2000	$10	$20000				3000	$10	$30000
			4000	$11	$44000	2000	$11	$22000
2000		$20000	4000		$44000	8000		$79000

Perpetual Average:-

LIFO	Inventory on Hand			Cost of Goods Sold
	# of units	Cost pu	Inventory Value	# of units	Avg cost pu	Cost of Goods Sold
Beginning Inventory	6000	$9	$54000
Sale-Jan 5	-3000	$9	-$27000	3000	$9	$27000
Subtotal Average cost	3000	9	27000
Purchase-Jan 10	5000	10	50000
Subtotal Average cost	8000	9.625	77000
Sale-Jan 12	-2000	9.625	-19250	2000	9.625	19250
Subtotal Average cost	6000	9.3571	57750
Purchase-Jan 18	6000	11	66000
Subtotal Average cost	12000	10.3125	123750
Sale-Jan 20	-4000	10.3125	-41250	4000	10.3125	41250
Total	8000		82500	15000		87500