Question

Your answer is incorrect. Concord Corp. had 1,900 units of part T on hand April 1, 2017, costing $8 each. During April, Concord made the following purchases of part T. Units Unit Cost April 4 2,700 $8.25 10 4,800 8.40 19 1,200 9 29 3,000 9.90 A physical count at April 30, 2017 showed 4,300 units of Part T on hand. Using the FIFO method, what is the cost of part T inventory at April 30, 2017? Using the LIFO method, what is the inventory cost? Using the average-cost method, what is the inventory cost? (Round average cost per unit to 2 decimal places, e.g. 15.25 and final answers to 0 decimal places, e.g. 1,620.) FIFO LIFO Average Cost Inventory Cost

Sheridan Company has used the dollar-value LIFO method since January 1, 2017. Sheridan uses internal price indexes and multiple pools. At the end of calendar year 2018, the following data are available for Sheridan’s inventory pool A. Inventory At Base-Year Cost At Current-Year Cost January 1, 2017 $1,000,000 $1,000,000 December 31, 2017 1,290,000 1,419,000 December 31, 2018 1,340,000 1,581,200 Computing an internal price index and using the dollar-value LIFO method, at what amount should the inventory in Pool A be reported at December 31, 2018? December 31, 2018 Price Index Dollar-value LIFO inventory

Answer 1

Answer to Question 1:

Cost of goods available for sale = 1,900 * $8.00 + 2,700 * $8.25 + 4,800 * $8.40 + 1,200 * $9.00 + 3,000 * $9.90
Cost of goods available for sale = $118,295

Number of units available for sale = 1,900 + 2,700 + 4,800 + 1,200 + 3,000
Number of units available for sale = 13,600

Number of units in ending inventory = 4,300

FIFO:

Ending inventory includes 3,000 units from April 29 purchase, 1,200 units from April 19 purchase and 100 units from April 10 purchase.

Cost of ending inventory = 3,000 * $9.90 + 1,200 * $9.00 + 100 * $8.40
Cost of ending inventory = $41,340

LIFO:

Ending inventory includes 1,900 units from April 1 inventory and 2,400 units from April 4 purchase.

Cost of ending inventory = 1,900 * $8.00 + 2,400 * $8.25
Cost of ending inventory = $35,000

Average Cost:

Average cost per unit = Cost of goods available for sale / Number of units available for sale
Average cost per unit = $118,295 / 13,600
Average cost per unit = $8.70

Cost of ending inventory = 4,300 * $8.70
Cost of ending inventory = $37,410