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In: Accounting
Calculate the ending inventory if the company uses LIFO method March 1 Beginning inventory 1,950 liters...
Calculate the ending inventory if the company uses LIFO method
| March | 1 | Beginning inventory 1,950 liters at a cost of 60¢ per liter. | ||
| March | 3 | Purchased 2,475 liters at a cost of 65¢ per liter. | ||
| March | 5 | Sold 2,320 liters for $1.10 per liter. | ||
| March | 10 | Purchased 3,820 liters at a cost of 72¢ per liter. | ||
| March | 20 | Purchased 2,580 liters at a cost of 80¢ per liter. | ||
| March | 30 | Sold 5,160 liters for $1.25 per liter. |
I got
03/05 COGS -> 2320(.65)= $ 1508
03/30 COGS -> 2580(0.80)+2580(0.72)= $ 3921.6
TOTAL COGS= $ 5429.6
ENDING INVENTORY= 7593.15-5429.6= $ 2163.55
WHY IS THIS WRONG?
Solutions
Expert Solution
| LIFO | |||||||||||||||
| Opening Inventory | Purchase | Sales | Cost of Goods sols | Closing Inventory | |||||||||||
| Date | Quantity | Unit Cost | Total Cost | Quantity | Unit Cost | Total Cost | Quantity | Unit Cost | Total Cost | Quantity | Unit Cost | Total Cost | Quantity | Unit Cost | Total Cost |
| MARCH .1 | 1,950 | 0.60 | 1,170 | - | - | 1,950 | 0.60 | 1,170 | |||||||
| MARCH .3 | 1,950 | 0.60 | 1,170 | 2,475 | 0.65 | 1,609 | - | 1,950 | 0.60 | 1,170 | |||||
| 2,475 | 0.65 | 1,609 | |||||||||||||
| MARCH .5 | 1,950 | 0.60 | 1,170 | 2,320 | 1.1 | 2,552 | 2,320 | 0.65 | 1,508 | 1,950 | 0.60 | 1,170 | |||
| 2,475 | 0.65 | 1,609 | 155 | 0.65 | 101 | ||||||||||
| MARCH .10 | 1,950 | 0.60 | 1,170 | 3,820 | 0.72 | 2,750 | 1,950 | 0.60 | 1,170 | ||||||
| 155 | 0.65 | 101 | 155 | 0.65 | 101 | ||||||||||
| 3,820 | 0.72 | 2,750 | |||||||||||||
| MARCH .20 | 1,950 | 0.60 | 1,170 | 2,580 | 0.80 | 2,064 | 1,950 | 0.60 | 1,170 | ||||||
| 155 | 0.65 | 101 | 155 | 0.65 | 101 | ||||||||||
| 3,820 | 0.72 | 2,750 | 3,820 | 0.72 | 2,750 | ||||||||||
| 2,580 | 0.80 | 2,064 | |||||||||||||
| MARCH .30 | 1,950 | 0.60 | 1,170 |
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