Question

Bonita Company reports the following for the month of June.

Date		Explanation		Units		Unit Cost			Total Cost
June 1		Inventory		200		$3			$600
12		Purchase		400		6			2,400
23		Purchase		400		7			2,800
30		Inventory		50

Assume a sale of 500 units occurred on June 15 for a selling price of $8 and a sale of 450 units on June 27 for $9.

Calculate cost of goods available for sale. The cost of goods available for sale $5800

Calculate Moving-Average unit cost for June 1, 12, 15, 23 & 27.(Round answers to 3 decimal places, e.g. 2.525.)

Calculate the cost of the ending inventory and the cost of goods sold for each cost flow assumption, using a perpetual inventory system. (Round average-cost per unit to 3 decimal places, e.g. 12.520 and final answer to 0 decimal places, e.g. 1,250.)

Answer 1

The answer has been presented in the supporting sheet. For detailed answer refer to the supporting sheet.

A E F G Answer Part 1) Cost of goods available for sale = no. of unit * cost per unit = 600+2400+2800 =$ 5800 Part 2) Moving Average June.1 (600/200) - Jnue.12 (600+2400)/(200+400)) - June.15 June. 23 ((30000-2500)/(600-500)) 6.60 ((500+2800)/(100+400)) 6.60 ((3300-(450*6.6))/(500-450)) June. 27 Formula Moving average =((Preceeding invetory cost +/- Purchase/sale cost))/(preceeding inventory units +/- purchase / sale unit)

Part 3) 5 Ending Inventory FIFO 350 (50*7) 5450 (5800-350) LIFO 150 (50*3) Moving Average Cost 330 (50*6.6) 5470 (5800-330) 3 Cost of goods sold 5650 (5800-150) Formula e Ending inventory = no. of unit * cost as per FIFO/LIFO/ Moving Average Cost of goods sold = total goods availale for sale - ending inventroy