Computing Cost of Goods Sold and Ending Inventory Under FIFO, LIFO, and Average Cost Assume that...

Computing Cost of Goods Sold and Ending Inventory Under FIFO, LIFO, and Average Cost
Assume that Madden Company reports the following initial balance and subsequent purchase of inventory.

Inventory balance at beginning of year	1,820	units @ $150 each	$273,000
Inventory purchased during the year	2,380	units @ $180 each	428,400
Cost of goods available for sale during the year	4,200	units	$701,400

Assume that 2,800 units are sold during the year. Compute the cost of goods sold for the year and the inventory on the year‑end balance sheet under the following inventory costing methods.

		COGS	Ending Inventory
a.	FIFO	Answer	Answer
b.	LIFO	Answer	Answer
c.	Average Cost	Answer	Answer

Solutions

Expert Solution

Calculate following

		COGS	Ending inventory
a	FIFO	701400-252000 = 449400	1400*180 = 252000
b	LIFO	701400-210000 = 491400	1400*150 = 210000
c	Average cost	701400-233800 = 467600	701400/4200*1400 = 233800

ekkarill92 answered 1 year ago

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