Question

The following data are available for Hollis for the fiscal year ended on January 31, 2020:

Sales	810	units
Beginning inventory	260	units	@	$	3
Purchases, in chronological order	340	units	@	$	4
	430	units	@	$	6
	240	units	@	$	8

Required:
a. Calculate cost of goods sold and ending inventory under the cost flow assumptions, FIFO, LIFO and Weighted average (using a periodic inventory system): (Round unit cost to 2 decimal places.)


b. Assume that net income using the weighted-average cost flow assumption is $14,600. Calculate net income under FIFO and LIFO.(Round unit cost to 2 decimal places.)

Answer 1

Requirement a

	FIFO	LIFO	Weighted Average
Cost of Goods Sold	$       3,400.00	$       5,060.00	$       4,234.20 or $ 4234
Ending Inventory	$       3,240.00	$       1,580.00	$       2,405.80 or $2406

Requirement b

Net income as per Weighted average	$           14,600
Less: Difference in Cost of goods sold between fifo and weighted average (4234.20-5060)	$                 826
Net income as per FIFO	$           13,774 or $13,774.20

Net income as per Weighted average	$     14,600.00
Add: Difference in Cost of goods sold between LIFO and weighted average (4234.20-3400)	$           834.20
Net income as per LIFO	$     15,434 or $15,434.20

Please put final answer as per roundoff requirements.