Question

A company just starting business made the following four inventory purchases in June

June 1     150 units    $390

June 10   200 units    $598

June 15   200 units     $630

June 28 150 units     $510

                                 Total $ 2,128

A physical count of merchandise inventory on June 30 reveals that there are 200 units on hand.

Using the LIFO inventory method, the value of the ending inventory on June 30 is?

Using the FIFO inventory method, the value of the ending inventory on June 30 is?

Using the average cost method whats the amount allocated to the ending inventory on June 30?

Answer 1

	LIFO	FIFO	Average Cost
The ending Inventory	$     88,400	$ 1,08,000	$      1,08,743
Workings:
	Cost of goods available for sale			Cost of goods sold - Periodic FIFO			Ending Inventory
LIFO	# of units    (A)	Cost per unit	Cost of goods available for sale	# of units sold               (B)	Cost per unit	Cost of goods sold	# of units in ending inventory      (A) - (B)	Cost per unit	Ending Inventory
Purchases:
Jun-01	150	$          390	$          58,500	150	$         390	$     58,500	150	$         390	$     58,500
Jun-10	200	$          598	$      1,19,600	150	$         598	$     89,700	50	$         598	$     29,900
Jun-15	200	$          630	$      1,26,000	200	$         630	$ 1,26,000	-	$         630	$              -
Jun-28	150	$          510	$          76,500	150	$         510	$     76,500	-	$         510	$              -
	700		$      3,80,600	500		$ 3,50,700	200		$     88,400
	Cost of goods available for sale			Cost of goods sold - Periodic FIFO			Ending Inventory
FIFO	# of units    (A)	Cost per unit	Cost of goods available for sale	# of units sold               (B)	Cost per unit	Cost of goods sold	# of units in ending inventory      (A) - (B)	Cost per unit	Ending Inventory
Purchases:
Jun-01	150	$          390	$          58,500	150	$         390	$     58,500	-	$         390	$              -
Jun-10	200	$          598	$      1,19,600	200	$         598	$ 1,19,600	-	$         598	$              -
Jun-15	200	$          630	$      1,26,000	150	$         630	$     94,500	50	$         630	$     31,500
Jun-28	150	$          510	$          76,500	-	$         510	$              -	150	$         510	$     76,500
	700		$      3,80,600	500		$ 2,72,600	200		$ 1,08,000
	Cost of goods available for sale			Cost of goods sold - Periodic FIFO			Ending Inventory
Weighted Average	# of units    (A)	Cost per unit	Cost of goods available for sale	# of units sold               (B)	Cost per unit	Cost of goods sold	# of units in ending inventory      (A) - (B)	Cost per unit	Ending Inventory
Purchases:
Jun-01	150	$          390	$          58,500
Jun-10	200	$          598	$      1,19,600
Jun-15	200	$          630	$      1,26,000
Jun-28	150	$          510	$          76,500
	700		$      3,80,600	500	$   543.71	$ 2,71,857	200	$   543.71	$ 1,08,743
*Average Cost	=	Cost of goods available for sale / No. Of units
	=	$380600 / 700 units
	=	$                                                                                                                                                                          543.71