Question

You are provided with the following information for Splish Brothers Inc. for the month ended June 30, 2020. Splish Brothers uses the periodic method for inventory.

Date				Description		Quantity		Unit Cost or  Selling Price
June		1		Beginning inventory		45		$42
June		4		Purchase		135		46
June		10		Sale		115		73
June		11		Sale return		13		73
June		18		Purchase		54		48
June		18		Purchase return		9		48
June		25		Sale		68		78
June		28		Purchase		25		52

(a1)Calculate weighted-average cost per unit. (Round answer to 2 decimal places, e.g. 5.25.)

Weighted-average cost per unit

$

(a2)

Calculate ending inventory, cost of goods sold, gross profit under each of the following methods. (1) LIFO. (2) FIFO. (3) Average-cost. (Round average-cost method answers to 2 decimal places, e.g. 1,250.25 and other answers to 0 decimal places, e.g. 1,250. Use weighted-average unit cost rounded to 2 decimal places for computations.)

		LIFO		FIFO		AVERAGE-COST
The ending inventory		$		$		$
The cost of goods sold		$		$		$
Gross profit		$		$		$

Answer 1

Requirement 1:

Weighted Average Cost Per unit
Units		(A)	250
Total Cost		(B)	$                11,560.00
Average Cost		(C=B/A)	$                         46.24

Requirement 2:

	FIFO	LIFO	Weighted Average
Ending Inventory	$ 3,920.00	$ 3,500.000	$ 3,699.200
Cost of Goods Sold	$ 7,640.000	$ 8,060.000	$ 7,860.800
gross profit	$ 5,110.00	$ 4,690.00	$ 4,889.20

Working:

Sales Revenue
		Units	Selling price per unit	value
Sales
10-Jun		115	$                         73.00	$                   8,395.00
11-Jun		-13	$                         73.00	$                    (949.00)
25-Jun		68	$                         78.00	$                   5,304.00
Total		170		$                 12,750.00

Cost of Goods Available for sale
		Units	Cost per unit	value
Beginning Inventory		45	$                         42.00	$                   1,890.00
Purchases
04-Jun		135	$                         46.00	$                   6,210.00
18-Jun		54	$                         48.00	$                   2,592.00
18-Jun		-9	$                         48.00	$                    (432.00)
28-Jun		25	$                         52.00	$                   1,300.00
Total		250		$                 11,560.00

	FIFO
A	Total Units Available for sale			250		$          11,560.00
	Units Sold			170
	Ending Inventory Units			80
	Valuation
	Cost of Goods Sold		45		$                         42.00	$            1,890.00
			125		$                         46.00	$            5,750.00
						$                         -
						$                         -
						$                         -
						$                         -
B	Cost of Goods Sold		170	units		$            7,640.00
A-B	Ending Inventory		80	units		$            3,920.00

	LIFO
A	Total Units Available for sale			250		$          11,560.00
	Units Sold			170
	Ending Inventory Units			80
	Valuation
	Cost of Goods Sold		25.00		$                         52.00	1,300.00
			45.00		$                         48.00	2,160.00
			100.00		$                         46.00	4,600.00
						-
						-
B	Cost of Goods Sold		170	units		$            8,060.00
A-B	Ending Inventory		80	units		$            3,500.00

	Weighted Average
A	Total Units Available for sale			250		$          11,560.00
	Units Sold			170
	Ending Inventory Units			80
	Valuation
	Cost of Goods Sold
			170		$                         46.24	$            7,860.80
						$                         -
B	Cost of Goods Sold		170	units	$                         46.24	$            7,860.80
A-B	Ending Inventory		80	units		$            3,699.20