Question

A. perpetual inventory using FiFO

B. lower of cost or market method

Perpetual Inventory Using FIFO Beginning Inventory, purchases, and sales for Item Zeta9 are as follows: Oct. 1 Inventory 61 units @ $21 7 Sale 43 units 15 Purchase 59 units @ $22 24 Sale 25 units Assuming a perpetual inventory system and using the first-in, first-out (FIFO) method, determine (a)the cost of goods sold on October 24 and (b) the inventory on October 31. a. Cost of goods sold on October 24 b. Inventory on October 31 1,298 Feedback Check My Work a. When the FIFO method is used, costs are included in cost of goods sold in the order in which they were purchased. Think of your inventory in terms of "layers." Determine how much inventory remains from each layer after each sale. b. The ending inventory is made up of the most recent purchases.

Answer 1

A) Ending Inventory (Units) = Beginning Inventory + Purchases - Sales = 61 + 59 - (43 +25) = 52 units Using FIFO Mehod Date Unit Cost Transacti Number of units Inventory 61 Purchase 7 Cost Of Goods Sold $1,281 $154 $1,435 Oct.1 Oct.15 $21 $22 Date b) Transacti Number on of units Purchase 52 Unit Ending Cost Inventory $22 $1,144 Oct.15 Total Item cost Market LCM Market Inventory Cost per value Quantity unit per unit 6,330 $10 $11 1,140 $36 $34 JFW1 SAW9 Total 63,300 $69,630 $63,300 $41,040 $38,760 $38,760 $102,060