Question

Required information

Use the following information for the Exercises below.

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Laker Company reported the following January purchases and sales data for its only product.

Date			Activities	Units Acquired at Cost								Units sold at Retail
Jan.	1		Beginning inventory	240	units	@	$	16.50	=	$	3,960
Jan.	10		Sales										190	units	@	$	25.50
Jan.	20		Purchase	170	units	@	$	15.50	=		2,635
Jan.	25		Sales										190	units	@	$	25.50
Jan.	30		Purchase	380	units	@	$	15.00	=		5,700
			Totals	790	units					$	12,295		380	units

The Company uses a perpetual inventory system. For specific identification, ending inventory consists of 410 units, where 380 are from the January 30 purchase, 5 are from the January 20 purchase, and 25 are from beginning inventory.

rev: 03_14_2019_QC_CS-162819

Exercise 5-3 Perpetual: Inventory costing methods LO P1

Required:
1. Complete the table to determine the cost assigned to ending inventory and cost of goods sold using specific identification.
2. Determine the cost assigned to ending inventory and to cost of goods sold using weighted average.
3. Determine the cost assigned to ending inventory and to cost of goods sold using FIFO.
4. Determine the cost assigned to ending inventory and to cost of goods sold using LIFO.

Answer 1

Required 1) Specific Identification Cost of goods sold Cost Available For sale Ending Inventory Cost of goods available for sale 16.50 $ 15.50 $ 15.00 $ Ending Inventory Units Ending Inventory Purchase Date Activity Unit Cost Units Sold 215 $ Unit Cost Units Cost per unit Cost Cost of goods sold 240 $ 170 $ 380 $ 16.50 $ 15.50 $ 15.00 $ Jan. 01 Beginning Inventory Jan. 20 Purchases $ 412.50 3,960.00 16.50 3,547.50 25 165 $ 15.50 $ 5 $ 2,635.00 2,557.50 77.50 Jan. 30 Purchases 5,700.00 380 5,700.00 - $ 6,105.00 6,190.00 790 12,295.00 380 410 "Units Sold Units Available for Sale Ending Inventory

Required 2) Weighted Average - Prepetual: Goods Purchased Inventory Balance Cost per Cost of goods sold Cost per Cost per Cost of Goods Inventory #of Units unit # of Units Sold unit sold #of Units unit Balance Date January.01 January. 10 January.20 240 16.50 3,960 50 @ 190 @ 3,135 16.50 16.50 825 16.50 170 15.50 50 825 170 @ 2,635 15.50 220 @ Average Cost 15.73 3,460 January.25 January.30 190 @ 15.73 2,988 30 15.73 472 380 15.00 30 15.73 472 380 @ 5,700 15.00 410 @ Totals 15.05 6,123 6,172 Under weighted average cost the ending balance per unit calculated by dividing total cost from total units

Required 3) Prepetual FIFO: Inventory Balance Cost per Goods Purchased Cost of goods sold Cost per Cost per Cost of Goods Inventory # of Units # of Units Sold unit unit unit sold #of Units Balance Date January.01 January.10 January.20 3,960 240 16.50 50 @ 190 16.50 16.50 3,135 825 16.50 170 15.50 50 825 15.50 170 2,635 3,460 January.25 16.50 50 16.50 825 140 15.50 2,170 30 15.50 465 465 January.30 380 15.00 16.50 30 15.50 465 5,700 380 @ 15.00 Totals 6,130 6,165

Required 4) Prepetual LIFO: Inventory Balance Cost per Goods Purchased Cost of goods sold Cost per Cost per Cost of Goods Inventory # of Units # of Units Sold unit unit Date unit sold #of Units Balance January.01 January.10 January.20 3,960 240 16.50 50 @ 190 16.50 16.50 3,135 825 16.50 170 15.50 50 825 170 15.50 2,635 3,460 January.25 16.50 170 15.50 2,635 30 495 20 16.50 330 15.50 495 15.00 January.30 380 30 @ 16.50 495 15.50 5,700 380 15.00 Totals 6,100 6,195