Question

Larkspur, Inc. uses a periodic inventory system and reports the following for the month of June. Date Explanation Units Unit Cost Total Cost June 1 Inventory 105 $5 $ 525 12 Purchases 375 6 2,250 23 Purchases 205 7 1,435 30 Inventory 240 Calculate weighted-average unit cost. (Round answer to 3 decimal places, e.g. 5.125.) Weighted-average unit cost $enter a weighted-average unit cost in dollars eTextbook and Media       Compute the cost of the ending inventory and the cost of goods sold under FIFO, LIFO, and average-cost. (Round answers to 0 decimal places, e.g. 125.) FIFO LIFO Average-cost The cost of the ending inventory $enter a dollar amount $enter a dollar amount $enter a dollar amount The cost of goods sold $enter a dollar amount $enter a dollar amount $enter a dollar amount eTextbook and Media

eTextbook and Media

List of Accounts

  

  

Compute the cost of the ending inventory under the average-cost method, assuming there are 400 units on hand at the end of the period. (Round answer to 0 decimal places, e.g. 125.)

The cost of the ending inventory

$enter the cost of the ending inventory in dollars

eTextbook and Media

List of Accounts

  

  

Answer 1

Solution

Weighted average unit cost = $6.146

.

	FIFO	LIFO	Weighted Average
Cost of Ending Inventory	$                 1,645	$                   1,335	$             1,475
Cost of Goods Sold	$                 2,565	$                   2,875	$             2,735

Assuming ending units are 400.

The cost of the ending inventory $ 2,458

Working

	Units	Cost per unit	value
Beginning Balance	105	$                     5.00	$ 525
Purchases
	375	$                     6.00	$ 2,250
	205	$                     7.00	$ 1,435
Total	685		$ 4,210

.

Average Cost of Inventory
Units	(A)	685
Total Cost	(B)	$ 4,210
Average Cost	(C=B/A)	$                   6.146

.

FIFO
Total Units Available for sale		685
Units Sold		445
Closing Stock in Units		240
Valuation
Ending Inventory	205	@	$               7.00	$ 1,435
	35	@	$               6.00	$ 210
Value Of Ending Inventory				$ 1,645
Cost of Goods sold				$ 2,565
LIFO
Total Units Available for sale		685
Units Sold		445
Closing Stock in Units		240
Valuation
Ending Inventory	105	@	$               5.00	$ 525
	135	@	$               6.00	$ 810
Value Of Ending Inventory				$              1,335
Cost of Goods sold	4210 minus 1335			$              2,875
Weighted Average method
Total Units Available for sale		685
Units Sold		445
Closing Stock in Units		240
Valuation
Ending Inventory	240	@	$             6.146	$              1,475
Value Of Ending Inventory				$              1,475
Cost of Goods sold	(Total Purchase and opening stock Minus Closing Stock)			$              2,735

Working for requirement 3

Weighted Average method
Total Units Available for sale		685
Units Sold		285
Closing Stock in Units		400
Valuation
Ending Inventory	400	@	$             6.146	$              2,458