Question

Windsor, Inc. is a retailer operating in Calgary, Alberta. Windsor uses the perpetual inventory method. Assume that there are no credit transactions; all amounts are settled in cash. You are provided with the following information for Windsor for the month of January 2022.

Date		Description		Quantity		Unit Cost or Selling Price
Dec. 31		Ending inventory		165		$20
Jan. 2		Purchase		99		21
Jan. 6		Sale		200		40
Jan. 9		Purchase		81		24
Jan. 10		Sale		65		44
Jan. 23		Purchase		100		26
Jan. 30		Sale		130		47

For each of the following cost flow assumptions, calculate (i) cost of goods sold, (ii) ending inventory, and (iii) gross profit. (Round answers to 0 decimal places, e.g. 125.)

(1)		LIFO.
(2)		FIFO.
(3)		Moving-average.

Answer 1

FIFO METHOD
		PURHASES			COST OF GOODS SOLD			CLOSING BALANCE
Date	Particulars	Units (A)	Rate Per unit	Total Cost	Units (A)	Rate Per unit	Total Cost	Units (A)	Rate Per unit	Total Cost
Jan, 01	Op. Stock							165	$         20.00	3300
Jan, 02	Purchases	99	$                        21.00	2079				165	$         20.00	3300
								99	$         21.00	2079
Jan, 06	Sales				165	$             20.00	3300
					35	$             21.00	735	64	$         21.00	1344
Jan, 09	Purchases	81	$                        24.00	$1,944				64	$         21.00	1344
								81	$         24.00	$1,944
Jan, 10	Sales				64	$             21.00	1344
					1	$             24.00	$24	80	$         24.00	$1,920
Jan, 23	Purchases	100	$                        26.00	$2,600				80	$         24.00	$1,920
								100	$         26.00	$2,600
Jan, 30	Sales				80	$             24.00	$1,920
					50	$             26.00	$1,300	50	$         26.00	$1,300
					395		$8,623	50		$1,300
LIFO METHOD
		PURHASES			COST OF GOODS SOLD			CLOSING BALANCE
Date	Particulars	Units (A)	Rate Per unit	Total Cost	Units (A)	Rate Per unit	Total Cost	Units (A)	Rate Per unit	Total Cost
Jan, 01	Op. Stock							165	$         20.00	3300
Jan, 02	Purchases	99	$                        21.00	2079				165	$         20.00	3300
								99	$         21.00	2079
Jan, 06	Sales				99	$             21.00	2079
					101	$             20.00	2020	64	$         20.00	1280
Jan, 09	Purchases	81	$                        24.00	$1,944				64	$         20.00	1280
								81	$         24.00	$1,944
Jan, 10	Sales				65	$             24.00	$1,560	64	$         20.00	1280
								16	$         24.00	$384
Jan, 23	Purchases	100	$                        26.00	$2,600				64	$         20.00	1280
								16	$         24.00	$384
								100	$         26.00	$2,600
Jan, 30	Sales				16	$             24.00	$384
					100	$             26.00	$2,600
					14	$             20.00	280	50	$         20.00	1000
					395		$8,923	50		$1,000
WEIGHTED AVG. METHOD
		PURHASES			COST OF GOODS SOLD			CLOSING BALANCE
Date	Particulars	Units (A)	Rate Per unit	Total Cost	Units (A)	Rate Per unit	Total Cost	Units (A)	Rate Per unit	Total Cost
Jan, 01	Op. Stock							165	$         20.00	3300
Jan, 02	Purchases	99	$                        21.00	2079				264	$         20.38	$         5,379
Jan, 06	Sales				200	$             20.38	$           4,075	64	$         20.38	$         1,304
Jan, 09	Purchases	81	$                        24.00	$1,944				145	$         22.40	$         3,248
Jan, 10	Sales				65	$             22.40	$           1,456	80	$         22.40	$         1,792
Jan, 23	Purchases	100	$                        26.00	$2,600				180	$         24.40	$         4,392
Jan, 30	Sales				130	$             24.40	$           3,172	50	$         24.40	$         1,220
					395		$8,703	50		$1,220
		FIFO	LIFO	Weigt Mov. Avg
	Sales (200 * $ 40 +65 * $44 + 130 * $ 47)	16970	16970	16970
	Less: Cost of Goods Sold	$8,623	$8,923	$8,703
	Gross Profit	$8,347	$8,047	$8,267