Question

Solve for FIFO, LIFO AND AVERAGE COST

Altira Corporation provides the following information related to its merchandise inventory during the month of August 2021: Aug.1 Inventory on hand-2,300 units; cost $5.60 each. 8 Purchased 11,500 units for $5.80 each. 14 Sold 9,200 units for $12.30 each. 18 Purchased 6,900 units for $5.99 each. 25 Sold 8,200 units for $11.30 each. 28 Purchased 4,300 units for $5.80 each. 31 Inventory on hand-7,600 units. Required: Using calculations based on a periodic inventory system, determine the inventory balance Altira would report in its August 31, 202 balance sheet and the cost of goods sold it would report in its August 2021 income statement using each of the following cost flow methods. Complete this question by entering your answers in the tabs below. FIFO LIFO Average Cost Determine the inventory balance Altira would report in its August 31, 2021, balance sheet and the cost of goods sold it would report in it method. (Round "Cost per Unit" to 2 decimal places.) Cost of Goods Available for Sale Cost of Goods Sold - Periodic FIFO Ending Inventory - P FIFO # of units in ending inventory Cost Cost of Goods # of units per unit Available for Sale 2200 5.60LS 12 A80? Cost of Goods Sold Cost # of units sold per unit 2300 5.60 C ре Beginning inventory 12 880 < Prey 7 of 13 Next >

Answer 1

Calculation of Units available for sale and Units of Ending Inventory
	Units available for sale
	Beginning Inventory, August 1				2300
	Purchases
	August 8			11500
	August 18			6900
	August 28			4300	22700
	Units available for sale				25,000
Less:	Units sold
	August 14			9200
	August 25			8200	17400
	Units of Ending Inventory				7,600
Schedule of Cost of Goods Available for Sale
		Cost of Goods Available for Sale
		Units	Cost per unit	Cost of Goods Available for Sale
	Beginning Inventory (a)	2300	$                5.60	$           12,880
Add:	Purchases
	August 8	11500	$                5.80	$           66,700
	August 18	6900	$                5.90	$           40,710
	August 28	4300	$                5.80	$           24,940
	Cost of Goods available for sale	25000		$         145,230

(a) Calculation of ending inventory under FIFO - periodic system:-
	Periodic FIFO	Cost of Goods Available for Sale			Cost of Goods Sold - Periodic FIFO			Ending inventory - Periodic FIFO
		# of Units	Cost per Unit	Cost of Goods Available for Sale	# of Units sold	Cost per Unit	Cost of Goods Sold	# of Units in Ending inventory	Cost per Unit	Ending inventory
	Beginning Inventory	2,300	$                5.60	$           12,880	2,300	$5.60	$         12,880
	Purchases:
	August 8	11,500	$                5.80	$           66,700	11,500	$5.80	$         66,700
	August 18	6,900	$                5.90	$           40,710	3,600	$5.90	$         21,240	3,300	$5.90	$        19,470
	August 28	4,300	$                5.80	$           24,940				4,300	$5.80	$        24,940
	Total	25,000		$         145,230	17,400		$      100,820	7,600		44,410
(b) Calculation of ending inventory under LIFO - periodic system:-
	LIFO- Periodic	Cost of Goods Available for Sale			Cost of Goods Sold - Periodic LIFO			Ending inventory - Periodic LIFO
		# of Units	Cost of Goods Available for Sale	Cost of Goods Available for Sale	# of Units sold	Cost per Unit	Cost of Goods Sold	# of Units in Ending inventory	Cost per Unit	Ending inventory
	Beginning Inventory	2,300	$                5.60	$           12,880				2,300	$             5.60	$        12,880
	Purchases:
	August 8	11,500	$                5.80	$           66,700	6,200	$5.80	$         35,960	5,300	$5.80	$        30,740
	August 18	6,900	$                5.90	$           40,710	6,900	$5.90	$         40,710
	August 28	4,300	$                5.80	$           24,940	4,300	$5.80	$         24,940
	Total	25,000		$         145,230	17,400		$      101,610	7,600		43,620
(c) Calculation of ending inventory under Weighted Average Cost - Periodic system:-
	Periodic -Weighted Average Cost	Cost of Goods Available for Sale			Cost of Goods Sold - Average Cost			Ending inventory - Average Cost
		# of Units	Cost of Goods Available for Sale	Cost of Goods Available for Sale	# of Units sold	Average Cost per Unit	Cost of Goods Sold	# of Units in Ending inventory	Average Cost per Unit	Ending inventory
	Beginning Inventory	2,300	$                5.60	$           12,880
	Purchases:
	August 8	11,500	$                5.80	$           66,700
	August 18	6,900	$                5.90	$           40,710
	August 28	4,300	$                5.80	$           24,940
	Total	25,000	$                5.81	$         145,230	17,400	$                 5.81	$      101,080	7,600	$             5.81	44,150

		Amount of Goods Available for Sale	Ending Inventory	Cost of Goods Sold
a.	First-in, first-out	$     145,230	44,410	$         100,820
b.	Last-in, first-out	$     145,230	43,620	$         101,610
c	Weighted average cost	$     145,230	44,150	$         101,080

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