Question

Chase Co. uses the perpetual inventory method. The inventory records for Chase reflected the following information:

Jan 1	Beginning inventory	1,100 units @ $3.90
Jan 12	Purchase	1,200 units @ $3.70
Jan 18	Sales	1,300 units @ $5.40
Jan 21	Purchase	1,100 units @ $4.00
Jan 25	Purchase	900 units @ $3.80
Jan 31	Sales	1,250 units @ $5.40

TB MC Qu. 05-55 Assuming Chase uses a LIFO cost flow...

1. Assuming Chase uses a LIFO cost flow method, what is the amount of cost of goods sold for the sales transaction on January 18?

2. Assuming Chase uses a FIFO cost flow method, what is the cost of goods sold for the sales transaction on January 31?

3. Assuming Chase uses a FIFO cost flow method, what is the ending inventory on January 31?

Answer 1

Answer question

Answer:- _ LIFO melhods cost of goods sold on January 18 transaction = (1200x $ 3.70) +(100$390) ... = $4830 (2) Porpetuel - FIFO melhod: Ending inventor Purchares cost of goods sold cost Units per s unit per cost Units cost units per 1 Date I unit > unit 1000 $3.90 $3900 Jan! Jan 12 $3.90 $3900 $3.70 uullo 1200 $3.70 1000 1200 am 900 $4440 71000 300 3.90 3.70 3900 1110 $3.70 3330 Jan 18 900 1100 $4 $4400 370 $ 3.70 Jan 21 11100 3330 4400 3330 4400 3420 3420 900 1100 900 3.8 1 900 3.80 Jan 25 3000 3420 900 3.70 33301004 900 3.8 (400 4 Jan 31 350 - 9740 1650 19550 6420 Total .: cost of goods on January 31 transaction = $3330 + $1400 2 $4730 3) Ending inventory on Jan 31 = $6420 = X