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Periodic Method Average Cost Method : Date Activity 01-Apr Beginning Inventory 04-Apr purchase 08-Apr purchase 13-Apr purchase 21-Apr purchase 29-Apr purchase No of units Unit cost Total Cost 420 $ 6.00 $ 2,520.00 1050 $ 6.08 $ 6,384.00 560 $ 6.40 $ 3,584.00 840 $ 6.50 $ 5,460.00 490 $ 6.60 $ 3,234.00 350 $ 6.79 $ 2,376.50 $ 23,558.50 Cost of goods available for sale Average Cost per Unit = $23558.50/3710 $ 6.35
Periodic Method LIFO Method: Date Purchases Less : Sales Ending Inventory Units 3710 -490 3220 Activity 01-Apr Beginning Inventory 04-Apr purchase 08-Apr purchase 13-Apr purchase 21-Apr purchase 29-Apr purchase No of units Unit cost Total Cost 420 $ 6.00 $ 2,520.00 1050 $ 6.08 $ 6,384.00 560 $ 6.40 $ 3,584.00 840 $ 6.50 $ 5,460.00 490 $ 6.60 $ 3,234.00 350 $ 6.79 $ 2,376.50 Cost of goods available for sale $ 23,558.50 Ending Inventory 490 units : 420 units @ $6 70 units @ $6.08 2,520 426 $ Cost of Ending Inventory $ 2,946 Note : LIFO Method assumes that goods which are purchased last will be sold first SO. Ending inventory consists of units which are purchased first
Perpetual System FIFO Method Date Purchases unit cost Total cost Cost of goods sold Quantity unit cost Total cost Quantity Inventory Quantity unit cost total cost 420 $ 6.00 $ 2,520.00 Apr-01 Apr-03 350 $ 6.00 $ 2,100.00 70 $ 6.00 $ 420.00 Apr-04 1050 $ 6.08 $ 6,384.00 70 $ 6.00 1050 $ 6.08 $ 420.00 $ 6,384.00 560 $ 6.40 $ 3,584.00 70 $ 6.00 1050 $ 6.08 560 $ 6.40 $ 420.00 $ 6,384.00 $ 3,584.00 09-Apr 70 $ 6.00 910 $ 6.08 070 $ 420.00 $ 5,532.80 140 $ 6.08 560 $ 6.40 $ 851.20 $ 3,584.00 11 - Apr 280 $ 6.40 $ 1,792.00 140 $ 6.08 280 $ 6.40 $ 851.20 $ 1,792.00 13-Apr 840 $ 6.50 $ 5,460.00 280 $ 6.40 840 $ 6.50 $ 1,792.00 $ 5,460.00 21-Apr 490 $ 6.60 $ 3,234.00 280 $ 6.40 840 $ 6.50 490 $ 6.60 $ 1,792.00 $ 5,460.00 $ 3,234.00 23 - Apr 280 $ 6.40 560 $ 6.50 $ 1,792.00 $ 3,640.00 280 $ 6.50 490 $ 6.60 $ 1,820.00 $ 3,234.00 27 - Apr 140 $ 6.60 $ 924.00 280 $ 6.50 350 $ 6.60 $ 1,820.00 $ 2,310.00 29-Apr 350 $ 6.79 $ 2,376.50 140 $ 6.60 $ 924.00 350 $ 6.79 $ 2,376.50 490 $ 3,301
Periodic Method Average Cost Method : Date Units Purchases 3710 Less : Sales -490 Ending Inventory 3220 Activity 01-Apr Beginning Inventory 04-Apr purchase 08-Apr purchase 13-Apr purchase 21-Apr purchase 29-Apr purchase No of units Unit cost Total Cost 420 $ 6.00 $ 2,520.00 1050 $ 6.08 $ 6,384.00 560 $ 6.40 $ 3,584.00 840 $ 6.50 $ 5,460.00 490 $ 6.60 $ 3,234.00 350 $ 6.79 $ 2,376.50 $ 23,558.50 Cost of goods available for sale Average Cost per Unit = $23558.50/3710 $ 6.35 Ending Inventory 490 units : 490 units @ $6.35 3,112 Cost of Ending Inventory $ 3,112 Note : Avg cost method assumes that goods are sold at avg cost per unit Therefore, Ending inventory will also be valued at avg cost per unit Note : Round off taken upto 2 decimals
Perpetual System LIFO Method Date Quantity Apr-01 Purchases unit cost Total cost Cost of goods sold Quantity unit cost Total cost Inventory Quantity unit cost total cost 420 $ 6.00 $ 2,520.00 Apr-03 350 $ 6.00 $ 2,100.00 70 $ 6.00 $ 420.00 Apr-04 1050 $ 6.08 $ 6,384.00 70 $ 6.00 1050 $ 6.08 $ 420.00 $ 6,384.00 560 $ 6.40 $ 3,584.00 70 $ 6.00 1050 $ 6.08 560 $ 6.40 $ 420.00 $ 6,384.00 $ 3,584.00 09-Apr 560 $ 6.40 420 $ 6.08 $ 3,584.00 $ 2,553.60 70 $ 6.00 630 $ 6.08 $ 420.00 $ 3,830.40 11 - Apr 420 $ 6.08 $ 2,553.60 70 $ 6.00 210 $ 6.08 $ 420.00 $ 1,276.80 13-Apr 840 $ 6.50 $ 5,460.00 70 $ 6.00 210 $ 6.08 840 $ 6.50 $ 420.00 $ 1,276.80 $ 5,460.00 21-Apr 490 $ 6.60 $ 3,234.00 70 $ 6.00 210 $ 6.08 840 $ 6.50 490 $ 6.60 $ 420.00 $ 1,276.80 $ 5,460.00 $ 3,234.00 23-Apr 490 $ 6.60 350 $ 6.50 $ 3,234.00 $ 2,275.00 70 $ 6.00 210 $ 6.08 490 $ 6.50 $ 420.00 $ 1,276.80 $ 3,185.00 27-Apr 490 $ 6.50 140 $ 6.08 $ $ 3,185.00 851.20 70 $ 6.00 70 $ 6.08 $ $ 420.00 425.60 29-Apr 350 $ 6.79 $ 2,376.50 70 $ 6.00 70 $ 6.08 350 $ 6.79 $ $ $ 420.00 426 2,377 490 $ 3,222
Periodic Method FIFO Method: Date Units Purchases 3710 Less : Sales 490 Ending Inventory 3220 Activity 01-Apr Beginning Inventory 04-Apr purchase 08-Apr purchase 13-Apr purchase 21-Apr purchase 29-Apr purchase No of units Unit cost Total Cost 420 $ 6.00 $ 2,520.00 1050 $ 6.08 $ 6,384.00 560 $ 6.40 $ 3,584.00 840 $ 6.50 $ 5,460.00 490 $ 6.60 $ 3,234.00 350 $ 6.79 $ 2,376.50 Cost of goods available for sale $ 23,558.50 Less : Ending Inventory 490 units : 350 units @ $6.79 140 units @ $6.6 $ $ 2,377 924 Cost of Ending Inventory $ 3,301 Cost of goods sold = cost of goods available for sale - Cost of ending inventory $ 20. 258 Note : FIFO Method assumes that goods which are purchased first will be sold first SO. Ending inventory consists of units which are purchased last