Question

Periodic inventory by three methods; cost of goods sold The units of an item available for sale during the year were as follows: Jan. 1 Inventory 40 units at $120 Mar. 10 Purchase 50 units at $132 Aug. 30 Purchase 10 units at $140 Dec. 12 Purchase 100 units at $144 There are 40 units of the item in the physical inventory at December 31. The periodic inventory system is used Determine the ending inventory cost and the cost of goods sold by three methods. Round interim calculations to one decimal and final answers to the nearest whole dollar. Cost of Finding Inventory and cost of Goods sold Inventory Method Ending Inventory Cost of Goods Sold First-in, first-out (FIFO) Last-in, first-out (LFO) Weighted average cost

Answer 1

FIFO - PERIODIC METHOD
		PURHASES			COST OF GOODS SOLD			ENDING INVENTORY
Date	Particulars	Units	Rate	Total	Units	Rate	Total	Units	Rate	Total
Jnauary, 01	Beginning inventory	40	$                 120.00	$4,800
Add:	Purchases
Mar,10	Purhcases	50	$                 132.00	$6,600
Aug,30	Purhcases	10	$                 140.00	$1,400
Dec, 12	Purhcases	100	$                 144.00	$14,400
	Goods Available for Sales	200		$27,200
	Less:SALES (200 units - 40 untis = 160 Units)				40	$          120.00	$4,800
					50	$          132.00	$6,600
					10	$          140.00	$1,400
					60	$          144.00	$8,640	40	$      144.00	$5,760
		200		$27,200	160		$21,440	40		$5,760
LIFO - PERIODIC METHOD
		PURHASES			COST OF GOODS SOLD			ENDING INVENTORY
Date	Particulars	Units	Rate	Total	Units	Rate	Total	Units	Rate	Total
Jnauary, 01	Beginning inventory	40	$                 120.00	$4,800
Add:	Purchases
Mar,10	Purhcases	50	$                 132.00	$6,600
Aug,30	Purhcases	10	$                 140.00	$1,400
Dec, 12	Purhcases	100	$                 144.00	$14,400
	Goods Available for Sales	200		$27,200
	Less:SALES (200 units - 40 untis = 160 Units)				100	$          144.00	$14,400
					10	$          140.00	$1,400
					50	$          132.00	$6,600	40	$      120.00	$4,800
		200		$27,200	160		$22,400	40		$4,800
WEIGHTED AVERAGE METHOD
		PURHASES			COST OF GOODS SOLD			ENDING INVENTORY
Date	Particulars	Units	Rate	Total	Units	Rate	Total	Units	Rate	Total
Jnauary, 01	Beginning inventory	40	$                 120.00	$4,800
Add:	Purchases
Mar,10	Purhcases	50	$                 132.00	$6,600
Aug,30	Purhcases	10	$                 140.00	$1,400
Dec, 12	Purhcases	100	$                 144.00	$14,400
	Goods Available for Sales	200	$                 136.00	$27,200
	Less:SALES (200 units - 40 untis = 160 Units)				160	$          136.00	$21,760	40	$      136.00	$5,440
		200		$27,200	160		$21,760	40		$5,440
ANSWERS:
		ENDING INVENOTRY	COST OF GOODS SOLD
	FIFO	$5,760	$21,440
	LIFO	$4,800	$22,400
	WEIGHTED AVERAGE	$5,440	$21,760