Question

In: Accounting

52. A company had the following purchases and sales during its first year of operations: Purchases...

52. A company had the following purchases and sales during its first year of operations:

Purchases Sales
January: 23 units at $205 17 units
February: 33 units at $210 17 units
May: 28 units at $215 21 units
September: 25 units at $220 20 units
November: 23 units at $225 25 units

On December 31, there were 32 units remaining in ending inventory. Using the Perpetual LIFO inventory valuation method, what is the cost of the ending inventory? (Assume all sales were made on the last day of the month.)

54. Salmone Company reported the following purchases and sales of its only product. Salmone uses a periodic inventory system. Determine the cost assigned to the ending inventory using FIFO.

Date Activities Units Acquired at Cost Units Sold at Retail
May 1 Beginning Inventory 260 units @ $11
5 Purchase 275 units @ $13
10 Sales 195 units @ $21
15 Purchase 155 units @ $14
24 Sales 145 units @ $22

Solutions

Expert Solution

Cost of ending inventory is $6,755 as calculated below:

LIFO-Perpetual
Date Goods Purchased Cost of goods sold Ending Inventory
Units @ Cost per unit Cost of purchase Units sold @ Cost per unit Cost of goods sold Units @ Cost per unit Ending balance
January 23 205 4,715 23 205 4,715
Balance 23 4,715
Jan-31 17 205 3,485 6 205 1,230
Balance 6 1,230
Feb 33 210 6,930 6 205 1,230
33 210 6,930
Balance 39 8,160
Feb-28 17 210 3,570 6 205 1,230
16 210 3,360
Balance 22 4,590
May 28 215 6,020 6 205 1,230
16 210 3,360
28 215 6,020
Balance 50 10,610
May-31 21 215 4,515 6 205 1,230
16 210 3,360
7 215 1,505
Balance 29 6,095
Sept 25 220 5500 6 205 1,230
16 210 3,360
7 215 1,505
25 220 5500
Balance 54 11,595
Sep-30 20 220 4400 6 205 1,230
16 210 3,360
7 215 1,505
5 220 1100
Balance 34 7,195
Nov 23 225 5175 6 205 1,230
16 210 3,360
7 215 1,505
5 220 1100
23 225 5175
Balance 57 12,370
Nov-30 23 225 5175 6 205 1,230
2 220 440 16 210 3,360
7 215 1,505
3 220 660
Balance 32 6,755

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