Question

Daniel Company uses a periodic inventory system. Data for the current year: beginning merchandise inventory (ending inventory December 31, prior year), 2,200 units at $37; purchases, 7,900 units at $39; expenses (excluding income taxes), $194,400; ending inventory per physical count at December 31, current year, 1,620 units; sales, 8,480 units; sales price per unit, $78; and average income tax rate, 32 percent Required: 1-a. Compute cost of goods sold under the FIFO, LIFO, and average cost inventory costing methods. 1-b. Prepare income statements under the FIFO, LIFO, and average cost inventory costing methods. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Compute cost of goods sold under the FIFO, LIFO, and average cost inventory costing methods. intermediate calculations. Round your final answers to the nearest whole dollar amount.) Inventory Costing Method FIFOR LIFO Units Average Cost 1 1 1 1 Cost of Goods Sold Beginning inventory Purchases Goods available for sale Ending inventory Cost of goods sold CD

Answer 1

Solution (1-a Calculation of lest of goods sold under the FIFO, LIFO and average Cost inventory Casting method I FIFO I LIFO Average Cost of goods units Irro int& in C$) est in ($) sold Beginning inventory Add! Purchases Goods available - for Sales Less! Ending Inventory 12200 81400 814 814 of T308, 10o 1308,100 308, 100 lola lolo 389500 3895 1389500 1620 63180 15994o 62467 Cost of goods 8480 326 320 329560 327037 Sold

solution 1-bl Income Statement under various method Income statement FITO LIFO Average $) C) 68($) sales revenues guso unit & $78) 661410 661440 661440 Less! Cast of Goods sold 326 320 329560327033 profit before 335120 331880334407 tax and expenses 11auno liquyco 1944 Profs't befox tanc 140720 137 480 140007. Less; tax @ 32% 145030.4 143033.6/44802224 ,ر معه(Expe Probit after tax 95689.6 91446-495204. 76

as per LIFO method Closing inventory Balance Amount Sales Rate unit Amount Receipts unit Rate ($) opening inventory (2200 37 81400 Purchases 17900 39 308100 sales (suso units) unit Amount ($J &2200 gluco 10100389500 1790039 58037 21460 1620 15994o as per averages est opening Inventory & Purchases) unit | Amount Cost of closing 1010 1389500 Inventory = 1620 unity $38.56 = 62467 (approx) Average Cost Per unit = 1 $389500 lolo unit = $38.56 / unit

Working Notes: - Calculation of I (2) Cost of endling Inventory under various method As per El Fomethed particulars Receipt unit pate sales Balance Amount unit I Rate unit Amount ($) | Amount T($) 2200 81400 Beginning inventory | 2200 37 e purchases 7900 $| MCo 308100 - 1000 sales 2200737 1389500 81400 22001 163180 244920 6280 1139