Question

Presented below is information related to BLANK radios for the BLANK Company for the month of July.

Date		Transaction		Units In		Unit Cost		Total		Units Sold		Selling Price		Total
July 1		Balance		130		$3.90		$  507
6		Purchase		1,040		4.00		4,160
7		Sale								390		$6.70		$ 2,613
10		Sale								390		7.00		2,730
12		Purchase		520		4.30		2,236
15		Sale								260		7.10		1,846
18		Purchase		390		4.40		1,716
22		Sale								520		7.10		3,692
25		Purchase		650		4.38		2,847
30		Sale								260		7.20		1,872
		Totals		2,730				$11,466		1,820				$12,753

Assuming that the periodic inventory method is used, compute the inventory cost at July 31 under each of the following cost flow assumptions. (Round answers to 0 decimal places, e.g. 6,578.)

(1) FIFO.
(2) LIFO.
(3) Weighted-average.

		(1) FIFO		(2) LIFO		(3) Weighted-Average
Ending Inventory at July 31		$		$		$

Answer 1

Closing inventory units = 2,730 - 1,820 = 910.

FIFO Method

>> Closing inventory = ( 650 * $ 4.38 ) + ( 260 * $ 4.40 ) = $ 3,991.

LIFO Method

>> Closing Inventory = ( 130 * $ 3.90 ) + ( 780 * $ 4 ) = $ 3,627.

Weighted average method.

Weighted average cost = $ 11,466 / 2,730 = $ 4.2

>> Closing Inventory = 910 * $ 4.2 = $ 3,822.