Question

Sandra’s Purse Boutique has the following transactions related to its top-selling Gucci purse for the month of October. Sandra's Purse Boutique uses a periodic inventory system.

Date			Transactions	Units				Unit Cost				Total Cost
October	1		Beginning inventory		6			$	790				$	4,740
October	4		Sale		4
October	10		Purchase		5				800					4,000
October	13		Sale		3
October	20		Purchase		4				810					3,240
October	28		Sale		7
October	30		Purchase		8				820					6,560
													$	18,540

2. Using FIFO, calculate ending inventory and cost of goods sold at October 31.

3. Using LIFO, calculate ending inventory and cost of goods sold at October 31.

4. Using weighted-average cost, calculate ending inventory and cost of goods sold at October 31. (Round your intermediate and final answers to 2 decimal places.)

Answer 1

Cost of Goods Available for Sale
Activity	Units	Unit Price	Amount
Beginning Inventory	6	$           790.00	$               4,740
Purchases Oct. 10	5	$           800.00	$               4,000
Purchases Oct. 20	4	$           810.00	$               3,240
Purchases Oct. 30	8	$           820.00	$               6,560
Total	23		$            18,540

Ending Inventory Units = 6-4+5-3+4-7+8 = 9 units

FIFO
Ending Inventory = 8 x $820 + 1 x $810 = $7370
Cost of Goods Sold = $18540 - 7370 = $11170

LIFO
Ending Inventory = 6 x $790 + 3 x $800 = $7140
Cost of Goods sold = $18540 - 7140 = $11400

Weighted Average
Ending Inventory = 9 x $806.09 = $7254.81
Cost of Goods Sold = $18540 - 7254.81 = $11285.19