In: Accounting
Compute the April cost of goods sold using moving average
method, and LIFO method.
Units |
Unit Cost |
Total Cost |
|
April 1 inventory |
300 |
$35 |
$10,500 |
April 15 purchase |
400 |
$40 |
$16,000 |
April 16 sales |
205 |
||
April 23 purchase |
200 |
$45 |
$9,000 |
April 24 sales |
305 |
Answer:
Using the Moving Average Method:
Date | Particulars | Units | Unit Cost | Average Unit Cost | Amount | |
April 1 | Opening Inventory | 300 | 35 | 35 | 10500 | |
April 15 | Purchase | 400 | 40 | 16000 | ||
April 16 | Sales | 205 | 37.86 | 7761.30 | ||
April 23 | Purchase | 200 | 45 | 9000 | ||
April 24 | Sales | 305 | 39.91 | 12172.55 |
April | Closing Inventory | 390 | 39.91 | 15564.90 |
Cost of Goods sold using Moving Average method are as follows:
Particulars | Amount |
Opening Inventory | 10500 |
Add: Purchase | 25000 |
Less: Closing Inventory | 15564.90 |
Cost of Goods Sold | 19935.10 |
Using LIFO Method:
Date | Particulars | Units | Unit Cost | Amount | Working |
April 1 | Opening Inventory | 300 | 35 | 10500 | |
April 15 | Purchase | 400 | 40 | 16000 | |
April 16 | Sales | 205 | 40 | 8200 | 205*40 |
April 23 | Purchase | 200 | 45 | 9000 | |
April 24 | Sales | 305 | 13200 | (200*45)+(105*40) |
April | Closing Inventory | 390 | 14100 | (90*40)+(300*35) |
Cost of Goods sold using LIFO method are as follows:
Particulars | Amount |
Opening Inventory | 10500 |
Add: Purchase | 25000 |
Less: Closing Inventory | 14100 |
Cost of Goods Sold | 21400 |