Question

Pete’s Tennis Shop has the following transactions related to its top-selling Wilson tennis racket for the month of August. Pete’s Tennis Shop uses a periodic inventory system.

Date			Transactions	Units	Unit Cost					Total Cost
August	1		Beginning inventory	8		$	155				$	1,240
August	4		Sale ($200 each)	5
August	11		Purchase	10			145					1,450
August	13		Sale ($215 each)	8
August	20		Purchase	10			135					1,350
August	26		Sale ($225 each)	11
August	29		Purchase	10			125					1,250
											$	5,290

For the specific identification method, the August 4 sale consists of rackets from beginning inventory, the August 13 sale consists of rackets from the August 11 purchase, and the August 26 sale consists of one racket from beginning inventory and 10 rackets from the August 20 purchase.

1. Calculate ending inventory and cost of goods sold at August 31, using the specific identification method.

  

Answer 1

• Requirement asked

Specific Identification	Cost of Goods available for sale			Cost of Goods Sold			Ending Inventory
	Units	Cost/unit	COG for sale	Units sold	Cost/unit	COGS	Units	Cost/unit	Ending inventory
Beginning Inventory	8	$              155.00	$                        1,240.00	6	$             155.00	$                     930.00	2	$              155.00	$                310.00
Purchases:
11-Aug	10	$              145.00	$                        1,450.00	8	$             145.00	$                 1,160.00	2	$              145.00	$                290.00
20-Aug	10	$              135.00	$                        1,350.00	10	$             135.00	$                 1,350.00	0	$              135.00	$                         -
29-Aug	10	$              125.00	$                        1,250.00	0	$             125.00	$                              -	10	$              125.00	$            1,250.00
TOTAL	38		$                        5,290.00	24		$                 3,440.00	14		$            1,850.00

• Cost of Goods Sold = $ 3440
• Ending Inventory = $ 1850