Question

Calculating the Value of Ending Inventory and Cost of Goods Sold: Perpetual Method
	Total Units	Unit Cost	Total Cost
Beginning inventory on hand
1-Jan	60,000	$2.00	$120,000
Purchases during month
5-Jan	103,600	$2.00	$207,200
20-Jan	293,900	$2.10	$617,190
Sales of inventory
25-Jan	383,900
Beginning inventory at
1-Feb	73,600
Purchases during month
8-Feb	282,200	$2.20	$620,840
23-Feb	153,500	$2.60	$399,100
Sales of inventory
27-Feb	407,600
Ending Inventory	101,700

FIFO
Jan		Feb
Cost of goods sold		Cost of goods sold
Ending inventory		Ending inventory

Answer 1

Ans- Calculating the ending inventory and cost of goods sold under perpetual method:-

Date	Purchases			Sales			Balance
	Units	Unit Cost	Total	Units	Unit Cost	Total	Units	Unit Cost	Total
Jan,1							60,000	$2	$120,000
Jan.5	103,600	$2	$207,200				60,000	$2	$120,000
							103,600	$2	$207,200
Jan.20	293,900	$2.10	$617,190				60,000	$2	$120,000
							103,600	$2	$207,200
							293,900	$2.10	$617,190
Jan.25				60,000	$2	$120,000
				103,600	$2	$207,200
				220,300	$2.10	$462,630	73,600	$2.10	$154,560
Total	397,500		$824,390	383,900		$789,830	73,600		$154,560

Date	Purchases			Sales			Balance
	Units	Unit Cost	Total	Units	Unit Cost	Total	Units	Unit Cost	Total
Feb.1							73,600	$2.10	$154,560
Feb.8	282,200	$2.20	$620,840				73,600	$2.10	$154,560
							282,200	$2.20	$620,840
Feb.23	153,500	$2.60	$399,100				73,600	$2.10	$154,560
							282,200	$2.20	$620,840
							153,500	$2.60	$399,100
Feb.27				73,600	$2.10	$154,560
				282,200	$2.20	$620,840
				51,800	$2.60	$134,680	101,700	$2.60	$264,420
Total	435,700		$1,019,940	407,600		$910,080	101,700		$264,420

FIFO

Jan		Feb
Cost Of Goods Sold	$789,830	Cost of Goods Sold	$910,080
Ending Inventory	$154,560	Ending Inventory	$264,420