Question

The following data are available for one of the products sold by Dahlia Company, which uses a perpetual inventory system:

Mar. 1 Beginning inventory, 500 units at $4.00 each

7 Purchased 2,000 units at $5.00 each

12 Sold 2,300 units

17 Purchased 1,800 units at $6.00 each

27 Sold 1,900 units

1. Calculate cost of goods sold for March and the dollar amount of ending inventory on March 31 assuming FIFO is used.

2. Calculate cost of goods sold for March and the dollar amount of ending inventory on March 31 assuming LIFO is used.

3. Calculate cost of goods sold for March and the dollar amount of ending inventory on March 31 assuming average cost is used. (Round average cost per unit to two decimal places. Round other amounts to the nearest dollar.)

Answer 1

Answer:-1)-

FIFO Method
Goods purchased			Cost of goods sold			Inventory balance
Date	# of units	Cost per unit	# of units sold	Cost per unit	Cost of goods sold	# of units	Cost per unit	Inventory balance
Mar-01						500	4	2000
Mar-07	2000	5				500	4	2000
						2000	5	10000
Mar-12			500	4	2000	200	5	1000
			1800	5	9000
Mar-17	1800	6				200	5.00	1000.00
						1800	6.00	10800.00
Mar-27			200	5	1000	100	6	600.00
			1700	6	10200
Totals			4200		22200

2)-

LIFO Method
Goods purchased			Cost of goods sold			Inventory balance
Date	# of units	Cost per unit	# of units sold	Cost per unit	Cost of goods sold	# of units	Cost per unit	Inventory balance
Mar-01						500	4	2000
Mar-07	2000	5				500	4	2000
						2000	5	10000
Mar-12			2000	5	10000	200	4	800
			300	4	1200
Mar-17	1800	6				200	4.00	800.00
						1800	6.00	10800.00
Mar-27			1800	6	10800	100	4	400.00
			100	4	400
Totals			4200		22400

3)-

Weighted Average Method
Goods purchased			Cost of goods sold			Inventory balance
Date	# of units	Cost per unit	# of units sold	Cost per unit	Cost of goods sold	# of units	Cost per unit	Inventory balance
Mar-01						500	4	2000
Mar-07	2000	5				500	4	2000
						2000	5	10000
Average costs						2500	4.8	12000
Mar-12			2300	4.8	11040	200	4.8	960
Mar-17	1800	6				200	4.8	960
						1800	6.00	10800
Average costs						2000	5.88	11760
Mar-27			1900	5.88	11172	100	5.88	588
Totals			4200		22212