Question

In: Accounting

The Ivanhoe Shop shows the following data related to an item of inventory: Inventory, January 1...

The Ivanhoe Shop shows the following data related to an item of inventory:
Inventory, January 1 310 units @ $6.00
Purchase, January 9 870 units @ $6.50
Purchase, January 19 210 units @ $7.00
Inventory, January 31 310 units

(a)

What value should be assigned to the ending inventory using FIFO?
Value assigned to the ending inventory $

Solutions

Expert Solution

  • Ending Inventory = $ 2,120

FIFO

Cost of Goods available for sale

Cost of Goods Sold

Ending Inventory

Units

Cost/unit

COG for sale

Units sold

Cost/unit

COGS

Units

Cost/unit

Ending inventory

Beginning Inventory

310

$                   6.00

$                        1,860.00

310

$                 6.00

$                 1,860.00

0

$                   6.00

$                         -  

Purchases:

09-Jan

870

$                   6.50

$                        5,655.00

770

$                 6.50

$                 5,005.00

100

$                   6.50

$                650.00

19-Jan

210

$                   7.00

$                        1,470.00

0

$                 7.00

$                              -  

210

$                   7.00

$            1,470.00

TOTAL

1390

$                        8,985.00

1080

$                 6,865.00

310

$            2,120.00


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