Question

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Karen Company reports the following for the month of June. Unit Units Total Cost Date Explanation Cost $4 $2,160 June 1 Inventory 540 12 Purchase 840 5,040 6 23 Purchase 8,320 1,040 Calculate the cost of the ending inventory and the cost of goods sold for each cost flow assumption, using a perpetual inventory system. Assume a sale of 910 units occurred on June 15 for a selling price of $8 and a sale of 940 units on June 27 for $9. (Round average cost per unit to 3 decimal places, e.g. 5.254 and final answers to 0 decimal places, e.g. 2,520.) FIFO Moving Average LIFO $ $ Cost of the ending inventory $ $ $ $ Cost of goods sold tA tA

Answer 1

Answer: Perpetual- FIFO method: sold Ending units inventory perunot goods perunt purchases cost of units | cost oate unats per un cost 540 $4 $2160 June 1 540 840 2160 Soup sune 12 l suo so $5040 6 2820 470 June 5 540 370 JO 2160 2220 0 470 1040 2820 8320 bune louo & 320 4 to 6 4560 Sto 2820 3760 June 27 1 410 $10,960 570 F4330 18 SD Total cost of ending inventory = $4560 cost of goods sold $19960.

Perpetual- Lito method :- Purchases cost uniks 1 of goods perunit sold I cost Ending inventory units per unit frost Date unuts perunut cost 540 $4 $2160 Sune! June 12 suo $6 sogo 540 840 2160 5040 June 15 5040 4 to 840 70 solo su 1680 280 June 23 104 1 8 18320 470 1880 8320 June 27 9408 | 7520 loyo 470 100 570 (880 800 Total 1850 $12,840 $2680 cost of ending inventory = $2650 cost of goods sold = & 12840.

Perpetual - Moning Average cost method :- cost of goody sold I units perunit cost purchases unus / perunt pole cost Ending mventory unts | perunit 540 $4 $2160 June 1 June 12 $40 6 5040 840 910 502452 June 23 loyo | 8 540 I 4 2160 I 6 T souo 7200 138058170 Ba|47488 470 5.217 5.217 470 I 5.217 2452 I 1040 I 8 8320 I 1510 7.134 7.134 6706 Sto 70134 4066 llusy | 570 4066 18320 107-72 June 27 940 1850 Total .. cost of ending muen tony = $4066 cost of goods sold = $11454 Thanks