Question

Pronghorn Corp sells a snowboard, EZslide, that is popular with snowboard enthusiasts. Below is information relating to Pronghorn Corp’s purchases of EZslide snowboards during September. During the same month, 100 EZslide snowboards were sold. Pronghorn Corp uses a periodic inventory system.

Date		Explanation		Units		Unit Cost		Total Cost
Sept. 1		Inventory		13		$115		$ 1,495
Sept. 12		Purchases		49		118		5,782
Sept. 19		Purchases		54		119		6,426
Sept. 26		Purchases		24		120		2,880
		Totals		140				$16,583

(a) Compute the ending inventory at September 30 using the FIFO, LIFO and average-cost methods. (Round average cost per unit to 3 decimal places, e.g. 125.153 and final answers to 0 decimal places, e.g. 125.)

		FIFO		LIFO		AVERAGE-COST
The ending inventory at September 30		$Enter a dollar amount		$Enter a dollar amount		$Enter a dollar amount

(b) Compute the cost of goods sold at September 30 using the FIFO, LIFO and average-cost methods. (Round average cost per unit to 3 decimal places, e.g. 125.153 and final answers to 0 decimal places, e.g. 125.)

		FIFO		LIFO		AVERAGE-COST
Cost of goods sold		$Enter a dollar amount		$Enter a dollar amount		$Enter a dollar amount

Answer 1

(a) FIFO From Sep 19 purchases - 16 X 119 = 1,904 From Sep 26 purchases - 24 X 120 = 2,880 Total $ 4,784

LIFO From Sep 12 purchases - 27 X 118 = 3,186 From Opening 13 X 115 = 1,495 Total $ 4,681

Average Cost Average is 16,583 / 140 = $ 118.45 Closing is 40 X 118.45 = $ 4,738

(b) Cost of Goods Sold = Opening + Purchases - Closing                                        = 1,495 + 15,088 - 4,784                                        = $ 11,799

(b) Cost of Goods Sold = Opening + Purchases - Closing                                        = 1,495 + 15,088 - 4,681                                        = $ 11,902

(b) Cost of Goods Sold = Opening + Purchases - Closing                                        = 1,495 + 15,088 - 4,738                                        = $ 11,845