Required information [The following information applies to the questions displayed below.] Jimmie’s Fishing Hole has the...

Required information [The following information applies to the questions displayed below.] Jimmie’s Fishing Hole has the following transactions related to its top-selling Shimano fishing reel for the month of June. Jimmie’s Fishing Hole uses a periodic inventory system. Date Transactions Units Unit Cost Total Cost June 1 Beginning inventory 16 $ 290 $ 4,640 June 7 Sale 11 June 12 Purchase 10 280 2,800 June 15 Sale 12 June 24 Purchase 10 270 2,700 June 27 Sale 8 June 29 Purchase 9 260 2,340 $ 12,480 3. Using LIFO, calculate ending inventory and cost of goods sold at June 30.

Solutions

Expert Solution

Ans.	Total units sold (11 + 12 + 8) = 31 units

	LIFO:	Cost of goods available for sale	Cost of goods sold - Periodic LIFO	Ending inventory - Periodic LIFO
		Units	Rate	Total	Units	Rate	Total	Units	Rate	Total
	Beginning inventory	16	$290.00	$4,640	2	$290.00	$580	14	$290.00	$4,060
	Purchases:
	12-Jun	10	$280.00	$2,800	10	$280.00	$2,800	0	$280.00	$0
	24-Jun	10	$270.00	$2,700	10	$270.00	$2,700		$270.00
	29-Jun	9	$260.00	$2,340	9	$260.00	$2,340	0	$260.00	$0
	Total	45		$12,480	31		$8,420	14		$4,060

	*In LIFO method the units that have purchased last, are released the first one and ending inventory units
	remain from the first purchase.

ekkarill92 answered 1 year ago

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