Question

Periodic inventory by three methods; cost of goods sold

The units of an item available for sale during the year were as follows:

Jan. 1	Inventory	50 units at $118
Mar. 10	Purchase	70 units at $130
Aug. 30	Purchase	30 units at $138
Dec. 12	Purchase	50 units at $142

There are 60 units of the item in the physical inventory at December 31. The periodic inventory system is used.

Determine the ending inventory cost and the cost of goods sold by three methods. Round interim calculations to one decimal and final answers to the nearest whole dollar.

Cost of Ending Inventory and Cost of Goods Sold
Inventory Method	Ending Inventory	Cost of Goods Sold
First-in, first-out (FIFO)	$	$
Last-in, first-out (LIFO)
Weighted average cost

Answer 1

	Ending Inventory	Cost of Goods Sold
First-in, first-out (FIFO)	8,480	17,760
Last-in, first-out (LIFO)	7,200	19,040
Weighted average cost	7,872	18,368

First-in, first-out (FIFO)					Calculation
Date	Decription	Quantity	Cost per unit	Total cost
1-Jan	Beginning Inventory	50	118.00	5,900.00
10-Mar	Purchase	70	130.00	9,100.00
30-Aug	Purchase	30	138.00	4,140.00
12-Dec	Purchase	50	142.00	7,100.00
	Goods Available for Sale	200		26,240.00
	Ending Inventory	50	142.00	7,100.00		Latest cost of 142 & 138 per unit to value inventory
	Ending Inventory	10	138.00	1,380.00
	Ending Inventory - total	60		8,480.00
	Cost of goods sold	140		17,760.00		200-60 = 140 units sold
						26240-8480 = 17760 Cost of goods sold
Last-in, first-out (LIFO)
Date	Decription	Quantity	Cost per unit	Total cost
1-Jan	Beginning Inventory	50	118.00	5,900.00
10-Mar	Purchase	70	130.00	9,100.00
30-Aug	Purchase	30	138.00	4,140.00
12-Dec	Purchase	50	142.00	7,100.00
	Goods Available for Sale	200		26,240.00
	Ending Inventory	50	118.00	5,900.00		Oldest cost of 118 & 130 per unit to value inventory
	Ending Inventory	10	130.00	1,300.00
	Ending Inventory - total	60		7,200.00
	Cost of goods sold	140		19,040.00		26240-7200 = 19040 Cost of goods sold
Weighted average cost
Date	Decription	Quantity	Cost per unit	Total cost
1-Jan	Beginning Inventory	50	118.00	5,900.00
10-Mar	Purchase	70	130.00	9,100.00
30-Aug	Purchase	30	138.00	4,140.00
12-Dec	Purchase	50	142.00	7,100.00
	Goods Available for Sale	200	131.20	26,240.00		26240/200 = 131.2 weighted average cost per unit
	Ending Inventory	60	131.20	7,872.00		60*131.2 = 7872
	Cost of goods sold	140		18,368.00		26240-7872 = 18368 Cost of goods sold