Question

Cornerstone Exercise 6-27 (Algorithmic) (Appendix) Inventory Costing Methods: Periodic FIFO Filimonov Company has the following information related to purchases and sales of one of its inventory items: Date Description Units Purchased at Cost Units Sold at Retail June 1 Beginning Inventory 150 units @ $10 - $1,500 9 Purchase 1 200 units @ $12 = $2,400 Sale 1 300 units @ $25 Purchase 2 250 units @ $14 = $3,500 Sale 2 225 units @ $25 Assume that Filimonov uses a periodic inventory system. Required: Calculate the cost of goods sold and the cost of ending inventory using the FIFO inventory costing method. Cost of goods sold $ 13,125 Cost of ending inventory $ -5,725 X

Answer 1

Answer:

Under Periodic inventory Method & FIFO

Cost of goods sold	$6,350
Cost of Ending inventory	$1,050

Calculations:

Date	Description	Units	x	Cost/unit	=	Total
June 1	Beginning inventory	150	x	$10	=	$1,500
June 9	Purchase 1	200	x	$12	=	$2,400
June 22	Purchase 2	250	x	$14	=	$3,500
	Cost of goods available for sale	600				$7,400
June 14	Cost of sale 1:
	From beginning inventory	150	x	$10	=	$1,500
	From purchase 1	150	x	$12	=	$1,800
June 29	Cost of sale 2:
	From purchase 1	50	x	$12	=	$600
	From purchase 2	175	x	$14	=	$2,450
	Cost of goods sold	525				$6,350
June 30	Cost of Ending balance:
	From purchase 2 [250-175]	75	x	$14	=	$1,050
	Cost of Ending balance	75				$1,050