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Specific Identification, FIFO, LIFO, and Weighted-Average Swing Company's beginning inventory and purchases during the fiscal year...

Specific Identification, FIFO, LIFO, and Weighted-Average

Swing Company's beginning inventory and purchases during the fiscal year ended September 30, 20-2, were as follows:

Units Unit Price Total Cost
October 1, 20-1 Beginning inventory 400 $20 $8,000
October 18 1st purchase 510 20.5 10,455
November 25 2nd purchase 200 21.5 4,300
January 12, 20-2 3rd purchase 350 23 8,050
March 17 4th purchase 880 24 21,120
June 2 5th purchase 850 24.5 20,825
August 21 6th purchase 200 25.5 5,100
September 27 7th purchase 730 26.5 19,345
4,120 $97,195

Use the following information for the specific identification method.

There are 1,300 units of inventory on hand on September 30, 20-2. Of these 1,300 units:

100 are from October 18, 20-1 1st purchase
200 are from January 12, 20-2 3rd purchase
100 are from March 17 4th purchase
400 are from June 2 5th purchase
200 are from August 21 6th purchase
300 are from September 27 7th purchase

Required:

Calculate the total amount to be assigned to cost of goods sold for the fiscal year ended September 30, 20-2, and ending inventory on September 30, 20-2, under each of the following periodic inventory methods. For the weighted-average method, round the average unit cost to two decimal places. Round all final answers to the nearest dollar.

Solutions

Expert Solution

Total units sold=Goods available for sale in units-Ending inventory units=4120-1300=2820 units
Weighted average:
Weighted average cost per unit=Total cost of goods available for sale/Goods available for sale in units=97195/4120=$ 23.59
Ending inventory=Ending inventory units*Weighted average cost per unit=1300*23.59=$ 30667
Cost of goods sold=Units sold*Weighted average cost per unit=2820*23.59=$ 66524
FIFO:
Under FIFO,it is assumed that unit purchased first are sold first
Cost of goods sold:
2820 units sold as follows:
$
Beg inventory 400 units at $ 20 8000
1st purchase 510 units at $ 20.50 10455
2nd purchase 200 units at $ 21.50 4300
3rd purchase 350 units at $ 23 8050
4th purchase 880 units at $ 24 21120
5th purchase 480 units at $ 24.50 11760
(2820-400-510-200-350-880)
Total 63685
Ending inventory (Consist of other purchases)
$
5th purchase 370 units at $ 24.50 9065
(850-480)
6th purchase 200 units at $ 25.50 5100
7th purchase 730 units at $ 26.50 19345
Total 1300 units 33510
LIFO:
Under LIFO,it is assumed that unit purchased last are sold first
Cost of goods sold:
2820 units sold as follows:
$
7th purchase 730 units at $ 26.50 19345
6th purchase 200 units at $ 25.50 5100
5th purchase 850 units at $ 24.50 20825
4th purchase 880 units at $ 24 21120
3rd purchase 160 units at $ 23 3680
(2820-730-200-850-880)
Total 70070
Ending inventory (Consist of other purchases)
$
Beg inventory 400 units at $ 20 8000
1st purchase 510 units at $ 20.50 10455
2nd purchase 200 units at $ 21.50 4300
3rd purchase 190 units at $ 23 4370
(350-160)
Total 1300 units 27125

ekkarill92 answered 2 years ago
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