Question

In: Accounting

Renford Corporation is a manufacturing firm. Presented below is information concerning one of its products: 1/1...

Renford Corporation is a manufacturing firm. Presented below is information concerning one of its products:

1/1

Beginning inventory

4,480

$15

2/12

Purchase

4,960

$20

3/2

Sale

3,880

$33

4/18

Purchase

6,400

$23

5/31

Sale

5,560

$35

Compute the cost of goods sold under the following situations:

  1. Periodic system, FIFO cost flow
  2. Perpetual system, FIFO cost flow
  3. Periodic system, LIFO cost flow
  4. Perpetual system, LIFO cost flow
  5. Periodic system, weighted-average cost flow
  6. Perpetual system, moving-average cost flow

Your answers must be submitted in an Excel file and must show all calculations used to arrive at the final answers.

Solutions

Expert Solution

Solution 1:

Computation of COGS and ending inventory - Periodic FIFO
Particulars Cost of goods available for sale Cost of goods sold Ending Inventory
Nos of units Unit Cost Cost of goods available for sale Nos of units sold Unit Cost Cost of goods sold Nos of units in ending inventory Unit Cost Ending inventory
Beginning inventory 4480 $15.00 $67,200 4480 $15.00 $67,200.00 0 $15.00 $0.00
Purchases:
12-Feb 4960 $20.00 $99,200 4960 $20.00 $99,200.00 0 $20.00 $0.00
18-Apr 6400 $23.00 $147,200 0 $23.00 $0.00 6400 $23.00 $147,200.00
Total 15840 $313,600 9440 $166,400.00 6400 $147,200.00

Solution 2:

Computation of ending inventory COGS under FIFO - Perpectual
Date Beginning Inventory Purchase Cost of Goods Sold Ending Inventory
Qty Rate Amount Qty Rate Amount Qty Rate Amount Qty Rate Amount
1-Jan 4480 $15.00 $67,200.00 0 $0.00 $0.00 0 $0.00 $0.00 4480 $15.00 $67,200.00
12-Feb 4480 $15.00 $67,200.00 4960 $20.00 $99,200.00 0 $0.00 $0.00 4480 $15.00 $67,200.00
4960 $20.00 $99,200.00
2-Mar 4480 $15.00 $67,200.00 0 $0.00 $0.00 3880 $15.00 $58,200.00 600 $15.00 $9,000.00
4960 $20.00 $99,200.00 4960 $20.00 $99,200.00
18-Apr 600 $15.00 $9,000.00 6400 $23.00 $147,200.00 0 $0.00 $0.00 600 $15.00 $9,000.00
4960 $20.00 $99,200.00 4960 $20.00 $99,200.00
6400 $23.00 $147,200.00
31-May 600 $15.00 $9,000.00 0 $0.00 $0.00 600 $15.00 $9,000.00 6400 $23.00 $147,200.00
4960 $20.00 $99,200.00 4960 $20.00 $99,200.00
6400 $23.00 $147,200.00
Total 9440 $166,400.00 6400 $147,200.00

Solution 3:

Computation of COGS and ending inventory - Periodic LIFO
Particulars Cost of goods available for sale Cost of goods sold Ending Inventory
Nos of units Unit Cost Cost of goods available for sale Nos of units sold Unit Cost Cost of goods sold Nos of units in ending inventory Unit Cost Ending inventory
Beginning inventory 4480 $15.00 $67,200 0 $15.00 $0.00 4480 $15.00 $67,200.00
Purchases:
12-Feb 4960 $20.00 $99,200 3040 $20.00 $60,800.00 1920 $20.00 $38,400.00
18-Apr 6400 $23.00 $147,200 6400 $23.00 $147,200.00 0 $23.00 $0.00
Total 15840 $313,600 9440 $208,000.00 6400 $105,600.00

Solution 4:

Computation of ending inventory COGS under LIFO - Perpectual
Date Beginning Inventory Purchase Cost of Goods Sold Ending Inventory
Qty Rate Amount Qty Rate Amount Qty Rate Amount Qty Rate Amount
1-Jan 4480 $15.00 $67,200.00 0 $0.00 $0.00 0 $0.00 $0.00 4480 $15.00 $67,200.00
12-Feb 4480 $15.00 $67,200.00 4960 $20.00 $99,200.00 0 $0.00 $0.00 4480 $15.00 $67,200.00
4960 $20.00 $99,200.00
2-Mar 4480 $15.00 $67,200.00 0 $0.00 $0.00 3880 $20.00 $77,600.00 4480 $15.00 $67,200.00
4960 $20.00 $99,200.00 1080 $20.00 $21,600.00
18-Apr 4480 $15.00 $67,200.00 6400 $23.00 $147,200.00 0 $0.00 $0.00 4480 $15.00 $67,200.00
1080 $20.00 $21,600.00 1080 $20.00 $21,600.00
6400 $23.00 $147,200.00
31-May 4480 $15.00 $67,200.00 0 $0.00 $0.00 5560 $23.00 $127,880.00 4480 $15.00 $67,200.00
1080 $20.00 $21,600.00 1080 $20.00 $21,600.00
6400 $23.00 $147,200.00 840 $23.00 $19,320.00
Total 9440 $205,480.00 6400 $108,120.00

Solution 5:

Computation of COGS and ending inventory - Periodic Weighted Average cost method
Particulars Cost of goods available for sale Cost of goods sold - Average cost Ending Inventory - Average cost
Nos of units Unit Cost Cost of goods available for sale Nos of units sold Unit Cost Cost of goods sold Nos of units in ending inventory Unit Cost Ending inventory
Beginning inventory 4480 $15.00 $67,200
Purchases:
1-Feb 4960 $20.00 $99,200
1-Mar 6400 $23.00 $147,200
Total 15840 $19.80 $313,600 9440 $19.80 $186,893 6400 $19.80 $126,707

Solution 6:



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