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Brief Exercise 6-35 (Algorithmic)Inventory Costing MethodsTyler Company has the following information related to purchases...

  1. Brief Exercise 6-35 (Algorithmic)
    Inventory Costing Methods

    Tyler Company has the following information related to purchases and sales of one of its inventory items.

    DateDescriptionUnits Purchased at CostUnits Sold at Retail
    Sept. 1Beginning inventory400 units @ $12
    Sept. 10Purchase600 units @ $13
    Sept. 20Sales
    		700 units @ $22
    Sept. 25Purchase800 units at $15

    Assume the company uses a perpetual inventory system.

    Required:

    Calculate ending inventory and cost of goods sold using the FIFO, LIFO, and average cost methods.


    		FIFOLIFOAvg Cost
    Cost of goods sold???
    Ending inventory???

Solutions

Expert Solution

FIFO LIFO AVERAGE COST
Cost of Goods Sold

(400*12)+(300*13)

= 8700

(600*13)+(100*12)

= 9000

 (700*12.60) = 8820
Ending inventory

(300*13)+(800*15)

= 15,900

(300*12)+(800*15)

= 15,600

(14.35*1100)

= 15,780

Average cost per unit

= [(400*12)+(600*13)]/(400+600) = 12.60

= [(300*12.60)+(800*15)]/(300+800) = 14.35

ekkarill92 answered 2 years ago
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