Question

Periodic Inventory by Three Methods; Cost of Merchandise Sold

The units of an item available for sale during the year were as follows:

Jan. 1	Inventory	50 units @ $108
Mar. 10	Purchase	70 units @ $118
Aug. 30	Purchase	10 units @ $126
Dec. 12	Purchase	70 units @ $130

There are 40 units of the item in the physical inventory at December 31. The periodic inventory system is used.

Determine the inventory cost and the cost of merchandise sold by three methods. Round interim calculations to one decimal and final answers to the nearest whole dollar.

Cost of Merchandise Inventory and Cost of Merchandise Sold
Inventory Method	Merchandise Inventory	Merchandise Sold
First-in, first-out (FIFO)	$	$
Last-in, first-out (LIFO)
Weighted average cost

Answer 1

Periodic-FIFO Date Quantity Amount Rate Beginning Inventory Purchase: 50 108.00 5400 8,260 10-Mar 70 118.00 30-Aug 12-Dec 10 126.00 1,260 70 130.00 9,100 Cost of Goods available for Sale (A) 200 24,020 Issue: 50 108.00 5,400 8,260 118.00 70 10 126.00 1,260 3,900 130.00 30 Cost of Goods Sold (B) 18,820 160 Ending Inventory (A-B) $ 40 5,200 Periodic-LIFO Quantity Amount Date Rate Beginning Inventory Purchase: 108.00 50 5400 10-Mar 70 118.00 8,260 30-Aug 12-Dec 1,260 10 126.00 9,100 70 130.00 Cost of Goods available for Sale (A) 24,020 200 Issue: 9,100 1,260 70 130.00 10 126.00 70 118.00 8,260 108.00 10 1,080 Cost of Goods Sold (B) 160 19,700 Ending Inventory (A-B) 40 4,320 Periodic-Weighted Average Cost Quantity Amount Date Rate Beginning Inventory Purchase: 108.00 50 5400 118.00 10-Mar 70 8,260 1,260 9,100 30-Aug 12-Dec 10 126.00 70 130.00 Cost of Goods available for Sale (A) 24,020 200 Issue: Rate 24020/200 = 160 120.10 19,216 19,216 Cost of Goods Sold (B) 160 Ending Inventory (A-B) 40 4,804 Cost of Merchandise Inventory and Cost of Merchandise Sold Inventory Merchandise Merchandise Inventory Method Sold First-in first-out (FIFO) Last-in, first-out (LIFO) Weighted average 5,200 18,820 4,320 $ 19,700 cost 4,804 $ 19,216