Question

Novak Ltd. uses the perpetual inventory system and reports the following inventory transactions for the month of June: Date Unit Cost $5 6 Total Cost $6,850.00 14,280 Explanation June 1 Beginning inventory 12 Purchases 15 Sale 16 Purchases 23 Purchases 27 Sales Units 1.370 2,380 (2,610) 4,480 1,600 (5,520) 31,360 12.800 8 (a) Determine the cost of goods sold and the cost of the ending inventory using (1) FIFO and (2) Average cost. (Round average final answers to 2 decimal places, e.g. 1.25. Do not round intermediate calculations.) FIFO Average Cost of goods sold $ A Cost of ending inventory $ A

Answer 1

Inventry Book FIFO Purchases Unit Cost Total Sales Unit Cost Total Units Date Units Jun-01 2,380.00 Jun-12 Balance Units Unit Cost 1,370.00 $ 5.00 1,370.00 $ 5.00 2,380.00 $ 6.00 $ 6.00 $ 14,280.00 1,370.00 ,240.00 $ $ 5.00 $ 6,850.00 6.00 $ 7,440.00 Jun-15 1 1 7.00 $ 31,360.00 4,480.00 $ Jun-16 1,600.00 $ 8.00 $ 12,800.00 1,140.00 $ 1,140.00 $ 4,480.00 $ 1,140.00 $ 4,480.00 $ 1,600.00 $ 100.00 $ 1,600.00 $ 6.00 6.00 7.00 6.00 7.00 8.00 7.00 8.00 Jun-23 1,140.00 $ 4,380.00 $ Jun-28 6.00 $ 6,840.00 7.00 $30,660.00 $ 51,790.00 Cost of Goods Sold Units Unit Cost Cost of Goods sold Jun-15 1,370.00 $ 5.00 $ 6,850.00 1,240.00 $ 6.00 $ 7,440.00 Jun-28 1,140.00 $ 6.00 $ 6,840.00 4,380.00 $ 7.00 $ 30,660.00 8,130.00 $ 51,790.00

Cost of ending Inventory Units 100.00 1,600.00 1,700.00 Unit Cost $ 7.00 $ 8.00 Ending Inventory $ 700.00 $ 12,800.00 $ 13,500.00

Date Units Jun-01 2,380.00 Jun-12 Jun-15 Inventry Book Average Cost Purchases Sales Balance Unit Cost Total Units Unit Cost Total Units Unit Cost Total 1,370.00 $ 5.00 $ 6,850.00 $ 6.00 $ 14,280.00 1,370.00 $ 5.00$ 6,850.00 2,380.00 $ 6.00 $ 14,280.00 3,750.00 $ 5.63 21,130.00 2,610.00 $ 5.63 $ 14,706.481,140.00 $ 5.63 $ 6,423.52 $ 7.00 $ 31,360.00 1,140.00 $ 5.63 $ 6,423.52 4,480.00 $ 7.00 $ 31,360.00 5,620.00 $ 6.72 37,783.52 $ 8.00 $ 12,800.00 5,620.00 $ 6.72 $ 37,783.52 1,600.00 $ 8.00 $ 12,800.00 7,220.00 $ 7.01 50,583.52 5,520.00 $ 7.01 $ 38,673.27 | 1,700.00 $ 7.01 | $ 11,910.25 4,480.00 Jun-16 1,600.00 Jun-23 Jun-28 Cost of Goods Sold Date Units Unit Cost Cost of Goods sold Jun-15 2,610.00 $ 5.63 $ 14,706.48 Jun-28 5,520.00 $ 7.01 $ 38,673.27 8,130.00 $ 53,379.75

Cost of ending Inventory Units 1,700.00 1,700.00 Unit Cost Ending Inventory $ 7.01 $ 11,910.25 $ 11,910.25