Question

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Laker Company reported the following January purchases and sales data for its only product.

Date			Activities	Units Acquired at Cost								Units sold at Retail
Jan.	1		Beginning inventory	180	units	@	$	10.50	=	$	1,890
Jan.	10		Sales										140	units	@	$	19.50
Jan.	20		Purchase	110	units	@	$	9.50	=		1,045
Jan.	25		Sales										130	units	@	$	19.50
Jan.	30		Purchase	260	units	@	$	9.00	=		2,340
			Totals	550	units					$	5,275		270	units

The Company uses a perpetual inventory system. For specific identification, ending inventory consists of 280 units, where 260 are from the January 30 purchase, 5 are from the January 20 purchase, and 15 are from beginning inventory.

Required:
1. Complete the table to determine the cost assigned to ending inventory and cost of goods sold using specific identification.
2. Determine the cost assigned to ending inventory and to cost of goods sold using weighted average.
3. Determine the cost assigned to ending inventory and to cost of goods sold using FIFO.
4. Determine the cost assigned to ending inventory and to cost of goods sold using LIFO.

Complete the table to determine the cost assigned to ending inventory and cost of goods sold using specific identification.

	Specific Identification Available for Sale Cost of Goods Sold Ending Inventory Purchase Date Activity Units Unit Cost Units Sold Unit Cost COGS Ending Inventory- Units Cost Per Unit Ending Inventory- Cost Jan. 1 Beginning inventory 180 Jan. 20 Purchase 110 Jan. 30 Purchase 260 550 0 $0 0 $0

Answer 1

1		Cost of goods available for sale			Cost of goods sold			Ending Inventory
	Specific Identification	# of units    (A)	Cost per unit	Cost of goods available for sale	# of units sold               (B)	Cost per unit	Cost of goods sold	# of units in ending inventory	Cost per unit	Ending Inventory
	Jan-01	180	$    10.50	$    1,890	165	$    10.50	$    1,733	15	$    10.50	$        158
	Jan-20	110	$       9.50	$    1,045	105	$       9.50	$        998	5	$       9.50	$          48
	Jan-30	260	$       9.00	$    2,340	-	$       9.00	$           -	260	$       9.00	$    2,340
	Total	550		5,275	270		2,730	280		2,545
2		Cost of goods available for sale			Cost of goods sold			Ending Inventory
	Weighted Average	# of units    (A)	Cost per unit	Cost of goods available for sale	# of units sold               (B)	Cost per unit	Cost of goods sold	# of units in ending inventory      (A) - (B)	Cost per unit	Ending Inventory
	Jan-01	180	$    10.50	$    1,890
	Jan-20	110	$       9.50	$    1,045
	Jan-30	260	$       9.00	$    2,340
	Total	550	$       9.59	5,275	270	$       9.59	2,590	280	$       9.59	2,685
	Weighted average rate	=	$5275 / 550
		=	$       9.59
3		Cost of goods available for sale			Cost of goods sold			Ending Inventory
	FIFO	# of units    (A)	Cost per unit	Cost of goods available for sale	# of units sold               (B)	Cost per unit	Cost of goods sold	# of units in ending inventory      (A) - (B)	Cost per unit	Ending Inventory
	Jan-01	180	$    10.50	$    1,890	180	$    10.50	$    1,890	-	$    10.50	$           -
	Jan-20	110	$       9.50	$    1,045	90	$       9.50	$        855	20	$       9.50	$        190
	Jan-30	260	$       9.00	$    2,340	0	$       9.00	$           -	260	$       9.00	$    2,340
	Total	550		5,275	270		2,745	280		2,530
4		Cost of goods available for sale			Cost of goods sold			Ending Inventory
	LIFO	# of units    (A)	Cost per unit	Cost of goods available for sale	# of units sold               (B)	Cost per unit	Cost of goods sold	# of units in ending inventory      (A) - (B)	Cost per unit	Ending Inventory
	Jan-01	180	$    10.50	$    1,890	160	$    10.50	$    1,680	20	$    10.50	$        210
	Jan-20	110	$       9.50	$    1,045	110	$       9.50	$    1,045	-	$       9.50	$           -
	Jan-30	260	$       9.00	$    2,340	0	$       9.00	$           -	260	$       9.00	$    2,340
	Total	550		5,275	270		2,725	280		2,550