Question

The ABC Company had the following inventory record for the month of January:

		# of	Unit
Date	Description	Items	Price	Item
1/1	Beginning     inventory	5	$20	Z1, Z2, Z3, Z4, Z5
1/5	Sale	2		Z2, Z5
1/11	Purchase	9	12	Z6, Z7, Z8, Z9, Z10, Z11, Z12, Z13, Z14
1/28	Sale	7		Z1, Z3, Z6, Z7, Z8, Z9, Z14

Required:

Assuming a perpetual system is in use, determine the cost of goods sold and the ending inventory using each of the following methods:

1. FIFO
2. LIFO
3. Weighted average
4. NOPDF

Answer 1

Perpetual System FIFO Method Date Quantity Jan-01 Purchases Cost of goods sold Inventory unit cost Total cost Quantity unit cost Total cost Quantity unit cost total cost 5 $ 20.00 $ 100.00 Jan-05 2 $20.00 $ 40.00 3 $ 20.00 $ 60.00 Jan-11 9 $ 12.00 $108.00 3 $ 20.00 9 $12.00 $ 60.00 $108.00 Jan-28 3 $20.00 4 $12.00 $ 60.00 $ 48.00 5 $12.00 $ 60.00 $ 148.00 5 $ 60.00 Perpetual System LIFO Method Date Quantity Jan-01 Purchases Cost of goods sold Inventory unit cost Total cost Quantity unit cost Total cost Quantity unit cost total cost 5 $ 20.00 $100.00 Jan-05 2 $20.00 $ 40.00 3 $ 20.00 $ 60.00 Jan-11 9 $ 12.00 $ 108.00 3 $20.00 9 $12.00 $ 60.00 $108.00 Jan-28 7 $12.00 $ 84.00 3 $ 20.00 2 $12.00 $ 60.00 $ 24.00 $ 124.00 5 $ 84.00 Perpetual System Weighted Average Method Date Quantity Jan-01 Purchases Cost of goods sold Inventory unit cost Total cost Quantity unit cost Total cost Quantity unit cost total cost 5 $ 20.00 $ 100.00 Jan-05 2 $ 20.00 $ 40.00 3 $ 20.00 $ 60.00 Jan-11 9 $ 12.00 $ 108.00 3 $ 20.00 9 $12.00 12 $14.00 $ 60.00 $ 108.00 $168.00 Jan-28 7 $14.00 $ 98.00 5 $14.00 $ 70.00 $ 138.00 5 $ 70.00 Done !! Please do rate :) Perpetual System
FIFO Method
Date	Purchases			Cost of goods sold			Inventory
	Quantity	unit cost	Total cost	Quantity	unit cost	Total cost	Quantity	unit cost	total cost
Jan-01							5	$20.00	$100.00
Jan-05				2	$20.00	$ 40.00	3	$20.00	$ 60.00
Jan-11	9	$12.00	$108.00				3	$20.00	$ 60.00
							9	$12.00	$108.00
Jan-28				3	$20.00	$ 60.00	5	$12.00	$ 60.00
				4	$12.00	$ 48.00
				9		$148.00	5		$ 60.00
Perpetual System
LIFO Method
Date	Purchases			Cost of goods sold			Inventory
	Quantity	unit cost	Total cost	Quantity	unit cost	Total cost	Quantity	unit cost	total cost
Jan-01							5	$20.00	$100.00
Jan-05				2	$20.00	$ 40.00	3	$20.00	$ 60.00
Jan-11	9	$12.00	$108.00				3	$20.00	$ 60.00
							9	$12.00	$108.00
Jan-28				7	$12.00	$ 84.00	3	$20.00	$ 60.00
							2	$12.00	$ 24.00
				9		$124.00	5		$ 84.00
Perpetual System
Weighted Average Method
Date	Purchases			Cost of goods sold			Inventory
	Quantity	unit cost	Total cost	Quantity	unit cost	Total cost	Quantity	unit cost	total cost
Jan-01							5	$20.00	$100.00
Jan-05				2	$20.00	$ 40.00	3	$20.00	$ 60.00
Jan-11	9	$12.00	$108.00				3	$20.00	$ 60.00
							9	$12.00	$108.00
							12	$14.00	$168.00
Jan-28				7	$14.00	$ 98.00	5	$14.00	$ 70.00
				9		$138.00	5		$ 70.00
Done !! Please do rate :)