Question

Ferris Company began 2018 with 4,000 units of its principal product. The cost of each unit is $7. Merchandise transactions for the month of January 2018 are as follows:

	Purchases
Date of Purchase	Units		Unit Cost*			Total Cost
Jan. 10	3,000		$	8			$	24,000
Jan. 18	4,000			9				36,000
Totals	7,000							60,000

*Includes purchase price and cost of freight.

Sales
Date of Sale	Units
Jan. 5	2,000
Jan. 12	1,000
Jan. 20	3,000
Total	6,000

5,000 units were on hand at the end of the month.

Required:
Calculate January's ending inventory and cost of goods sold for the month using each of the following alternatives:
1. FIFO, periodic system.
2. LIFO, periodic system.
3. LIFO, perpetual system.
4. Average cost, periodic system.
5. Average cost, perpetual system.


Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 Calculate January's ending inventory and cost of goods sold for the month using FIFO, periodic system. Cost of Goods Available for Sale Cost of Goods Sold - Periodic FIFO Ending Inventory - Per 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 Beginning Inventory Purchases: January 10 January 18 Total Required 1 Required 2 >

Answer 1

Ferris company
In periodic inventory, dates are not considered for calculating cost of each sale, instead cost of goods sold is calculated at the end of period
Total units sold are =6000
FIFO ( periodic )
	Cost of goods available for sale			COGS			Ending Inventory
Date	No. of units	cost p.u	Cost of goods available for sale	No. of units	cost p.u	COGS	No. of units	cost p.u	Ending inventory
beg. Inv.	4000	7	28000	4000	7	28000
Purchases	3000	8	24000	2000	8	16000	1000	8	8000
	4000	9	36000				4000	9	36000
	11000		88000	6000		44000	5000		44000
LIFO ( periodic )
	Cost of goods available for sale			COGS			Ending Inventory
Date	No. of units	cost p.u	Cost of goods available for sale	No. of units	cost p.u	COGS	No. of units	cost p.u	Ending inventory
beg. Inv.	4000	7	28000				4000	7	28000
Purchases	3000	8	24000	2000	8	16000	1000	8	8000
	4000	9	36000	4000	9	36000
	11000		88000	6000		52000	5000		36000
Weighted average cost( periodic )
	Cost of goods available for sale			COGS			Ending Inventory
Date	No. of units	cost p.u	Cost of goods available for sale	No. of units	cost p.u	COGS	No. of units	cost p.u	Ending inventory
beg. Inv.	4000		28000
Purchases	3000		24000
	4000		36000
	11000	8	88000	6000	8	48000	5000	8	40000
LIFO ( perpetual )
	Cost of goods available for sale			COGS			Ending Inventory
Date	No. of units	cost p.u	Cost of goods available for sale	No. of units	cost p.u	COGS	No. of units	cost p.u	Ending inventory
beg. Inv.	4000	7	28000				4000	7	28000
Sales				2000	7	14000	2000	7	14000
Purchases	3000	8	24000				2000	7	14000
							3000	8	24000
Sales				1000	8	8000	2000	7	14000
							2000	8	16000
Purchases	4000	9	36000				2000	7	14000
							2000	8	16000
							4000	9	36000
Sales				3000	9	27000	2000	7	14000
							2000	8	16000
							1000	9	9000
	11000		88000	6000		49000	5000		39000
Moving average( perpetual )
	Cost of goods available for sale			COGS			Ending Inventory
Date	No. of units	cost p.u	Cost of goods available for sale	No. of units	cost p.u	COGS	No. of units	cost p.u	Ending inventory
beg. Inv.	4000	7	28000				4000	7	28000
Sales				2000	7	14000	2000	7	14000
Purchases	3000	8	24000				5000	7.6	38000
Sales				1000	7.6	7600	4000	7.6	30400
Purchases	4000	9	36000				8000	8.3	66400
Sales				3000	8.3	24900	5000	8.3	41500
	11000		88000	6000		46500	5000		41500