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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.

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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 2 years ago
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