Question

Problem 8-05 Some of the information found on a detail inventory card for Tamarisk Inc. for the first month of operations is as follows. Received Date No. of Units Unit Cost Issued, No. of Units Balance, No. of Units January     2 1,300 $4.38 1,300 7 800 500 10 700 4.67 1,200 13 600 600 18 1,100 4.82 400 1,300 20 1,100 200 23 1,400 4.96 1,600 26 900 700 28 1,700 5.11 2,400 31 1,400 1,000

Your answer is correct. Calculate average-cost per unit. (Round answer to 2 decimal places, e.g. 2.76.) Average-cost per unit $ SHOW SOLUTION SHOW ANSWER LINK TO TEXT

Your answer is correct. From these data compute the ending inventory on each of the following bases. Assume that perpetual inventory records are kept in units only. (1) First-in, first-out (FIFO). (2) Last-in, first-out (LIFO). (3) Average-cost. (Round final answers to 0 decimal places, e.g. 6,548.) (1) FIFO (2) LIFO (3) Average-cost Ending Inventory $ $ $ SHOW SOLUTION SHOW ANSWER LINK TO TEXT

Your answer is partially correct. Try again. If the perpetual inventory record is kept in dollars, and costs are computed at the time of each withdrawal, would the amounts shown as ending inventory in (1), (2), and (3) above be the same? What amount would be shown as ending inventory? (Round average cost per unit to 4 decimal places, e.g. 2.7621 and final answers to 0 decimal places, e.g. 6,548.) (1) FIFO (2) LIFO (3) Average-cost Would amount be same Yes No No Ending Inventory $ 5110 $ 4889 $ ?

Answer 1

Req.1

Average Cost Per Unit

$4.82

Explanation:

1)

Date	Unit	Cost per unit	Total cost
	a	b	a*b
Jan 2.	1300	4.38	5694
Jan 10.	700	4.67	3269
Jan 18.	1100	4.82	5302
Jan 23.	1400	4.96	6944
Jan 28.	1700	5.11	8687
Total	6200		$29,896
Average cost per unit = 29896/6200=$ 4.82
Ending inventory in units=1000 units

Req.2

	FIFO	LIFO	Average
Ending Inventory	$5110	$4380	$4,820

Explanation:

1) FIFO:

Goods purchased first are sold first

Hence,ending inventory of 1000 units consist of last purchase (Jan 28.)

Ending inventory=1000*5.11 = $ 5110

2) LIFO:

Goods purchased last are sold first

Hence,ending inventory of 1000 units consist of last purchase (Jan 2)

Ending inventory=1000*4.38= $ 4,380

3)Average

Ending Inventory : 1000* $4.82 = $ 4820

Req.3

	FIFO	LIFO	Average Cost
Would amount be same	Yes	No	No
Amoun	$5110	$4889	$5057

Explanation:

1) FIFO

Amount would remain same so no need to calculate.

2) LIFO:

Jan 2 : 200 Unit *$4.38	$876
Jan 23 : 500 Unit *$4.96	$2480
Jan 28: 300 Unit *5.11	$1533
Total	$4889

3) Average Moving Cost