Question

                                                Units Cost per unit Total

Beginning inventory 60 $10               

Puirchase 3/31 40 $11                 

Purchase 4/30 40 $12                 

Purchase 5/31 60 $13                  

Total 200                                          

There are a total of 200 units. 80 units were left in ending inventory. Calculate the following under the periodic method for costing inventory:

1. Compute ending inventory using FIFO.

2. Compute cost of merchandise sold using FIFO.

3. Compute ending inventory using LIFO.

                

4. Compute cost of merchandise sold using FIFO.

5. Compute ending inventory using weighted average cost.

6.   Compute cost of merchandise sold using weighted average cost.

Answer 1

Total Purchases

		Units	Unit Cost	Cost
	Beginning inventory	60	10	$ 600
3/31	Purchase	40	11	$ 440
4/30	Purchase	40	12	$ 480
5/31	Purchase	60	13	$ 780
		200		$ 2,300

1) Compute ending inventory using FIFO (means latest purchases)

		Units	Unit Cost	Cost
4/30	Purchase	60	13	$ 780
5/31	Purchase	20	12	$ 240
		80		$ 1,020

2) Compute the cost of merchandise sold using FIFO

		Units	Unit Cost	Cost
	Beginning inventory	60	10	$ 600
3/31	Purchase	40	11	$ 440
4/30	Purchase	20	12	$ 240
		120		$ 1,280

3) Compute ending inventory using LIFO (means earliest purchases)

		Units	Unit Cost	Cost
	Beginning inventory	60	10	$ 600
3/31	Purchase	20	11	$ 220
		80		$ 820

4) Compute the cost of merchandise sold using LIFO

		Units	Unit Cost	Cost
5/31	Purchase	60	13	$ 780
4/30	Purchase	40	12	$ 480
3/31	Purchase	20	11	$ 220
		120		$ 1,480

5) Compute ending inventory using the weighted average cost:

$920

6) Compute the cost of merchandise sold using the weighted average cost:

$1,380