Question

begi ingin at tal cost of S25 520. The company pu chased 464 uits at a total cost of $67 280 At the end of the year, Shawn had 1 74 units in ending inventory. Sha ? Con anlad 232 es ten v (a) Conputs the coot of the nding invertory a nd the cost of gods sold under FIFO, LIFO, and average-cost. (Round average-cost per unit and final answers to o decimal places, e.g. 1,250) LIFO Average cost The cost of goods sold Attempts: 0 of

Answer 1

					FIFO	LIFO	Average cost
The cost of ending inventory					$ 25,230	$ 19,140	$       23,142
The cost of goods sold					$ 67,570	$ 73,660	$       69,426
Working:					Units	Unit cost	Total Cost
					a	a/b	b
a.		Beginning Inventory			232	$        110	$       25,520
		Purchase			464	$        145	$       67,280
		Total			696		$       92,800
		Ending inventory			174
		Units sold			522
b.		FIFO stands for first-in-first-out.It means inventory bought first will be sold first.
		So, sales of 522 units will be made from:
		Beginning Inventory			232	$        110	$       25,520
		Purchase	(balancing)		290	$        145	$       42,050
		Total			522		$       67,570
		So,
		Cost of goods available for sale					$       92,800
		Cost of goods old					$       67,570
		Cost of Ending Inventory					$       25,230
c.		LIFO stands for last in first out.It means inventory bought last will be sold first.
		So, sales of 522 units will be made from:
		Purchase			464	$        145	$       67,280
		Beginning Inventory		(balancing)	58	$        110	$         6,380
		Total			522		$       73,660
		So,
		Cost of goods available for sale					$       92,800
		Cost of goods old					$       73,660
		Cost of Ending Inventory					$       19,140
d.		Average Method:
		Average cost per unit			=		$       92,800	/	696
					=		$             133
		Cost of goods sold			=	522	x	$        133	=	$       69,426
		Ending Inventory			=	174	x	$        133	=	$       23,142
		Total								$       92,568