Question

question 23

The units of Product Green-2 available for sale during the year were as follows:

April	1		Inventory	15 units	@	$30
June	16		Purchase	29 units	@	$33
Sep.	28		Purchase	45 units	@	$35

There are 17 units of the product in the physical inventory at September 30. The periodic inventory system is used.

Determine the cost of goods sold by (a) FIFO, (b) LIFO, and (c) average cost methods. In your computations, round the average cost per unit to two decimal places and round your final answer to two decimal places.

a. FIFO	$fill in the blank 1
b. LIFO	$fill in the blank 2
c. Average cost	$fill in the blank 3

Answer 1

Solution

	Cost of goods sold
FIFO	$                   2,387
LIFO	$                   2,466
Weighted average	$                   2,412

Working

	Units	Cost per unit	value
Beginning Balance	15	$                   30.00	$ 450
Purchases
	29	$                   33.00	$ 957
	45	$                   35.00	$ 1,575
Cost of goods available for sale	89		$ 2,982

.

Average Cost of Inventory
Units	(A)	89
Total Cost	(B)	$ 2,982
Average Cost	(C=B/A)	$ 33.51

.

FIFO
Total Units Available for sale		89
Units Sold		72
Closing Stock in Units		17
Valuation
Ending Inventory	17	@	$             35.00	$ 595
Value Of Ending Inventory				$ 595
Cost of Goods sold	2982 minus 595			$        2,387.00
LIFO
Total Units Available for sale		89
Units Sold		72
Closing Stock in Units		17
Valuation
Ending Inventory	15	@	$             30.00	$ 450
	2	@	$             33.00	$ 66
Value Of Ending Inventory				$                  516
Cost of Goods sold	2982 minus 516			$              2,466
Weighted Average method
Total Units Available for sale		89
Units Sold		72
Closing Stock in Units		17
Valuation
Ending Inventory	17	@	$             33.51	$                  570
Value Of Ending Inventory				$                  570
Cost of Goods sold	(Total Purchase and opening stock Minus Closing Stock)	$              2,412